Canadian Regulatory Authorities Struggling To Define Rules

Now that Canada finally has a date for the recreational market start, the federal government, provinces and other regulatory authorities are beginning to issue guidelines and rules that are going to define the early days of the recreational industry.

These include regulations on retail trade, medical sales and use. However this is precisely where the confusion is growing.

The Government Will Continue To Run The Medical Cannabis System

In a move to protect patients, Health Canada has announced that it will continue to run the medical part of the market for at least the next five years. In good news for medical users, this announcement was made against calls from the Canadian Medical Association for the medical infrastructure developed on Canada’s path to recreational reform to be phased out. The reason, according to the CMA? Many doctors feel uncomfortable prescribing the drug because of a lack of research and a general lack of understanding about dosing.

Both patients and advocates have expressed support for continuing the medical system. This includes organizations like the Canadian Nurses Association who fear that if a focus is taken off of medical use, producers will ignore this part of the market to focus only on recreational sales.

In the future, after legalization, Health Canada will also continue to support more research and trials.

Provinces Are Setting Their Own Rules For Recreational Sales

Despite early statements, the recreational market is still in the throes of market creation and regulation. The laws are also changing in progress, a situation one regulator has described as building an airplane as it hurtles down the runway for take-off.

Athletes in Canada are still banned from using any kind of cannabis.For example, Ontario, the largest provincial market, is also delaying private sector sales in retail shops until next year. It is also moving away from a government-run dispensary model. Government sales will begin in October, but private dispensaries will have to wait until next April to open their doors (and existing operations will have to close their doors while they apply for licenses). This is also a reversal of the regional government’s position that it would only allow government-controlled shops to sell recreational cannabis.

But perhaps the largest unknown in both national and provincial policy outside of retail brick and mortars is in the area of online sales. A major fight is now brewing in many places where the established industry is now siding with the government about unregistered dispensaries (see Ontario) and established if not registered producers are competing directly with the government not only on main street but online as well.recreational users are beginning to sound alarms that they do not want the government to have so much personal information about them

Retailers with a web presence operating in a grey space will continue to pose a significant challenge to the online system now being implemented by the government for two reasons. Product availability (which will be far more limited on the government-run sites) and privacy.

Beyond the lack of diverse products and strains to be initially offered via the online government portals, recreational users are beginning to sound alarms that they do not want the government to have so much personal information about them – and point specifically to the differences in the regulated alcohol industry vs. the new regulations for the recreational cannabis market.

Beyond Market Rules, There Are Other Guidelines Coming

The Canadian military has now issued guidelines for active duty personnel and cannabis. It cannot ban it from soldiers entirely of course, and as it stands, the situation will be ripe for misunderstandings. For example, soldiers are prohibited from consuming cannabis 8 hours before any kind of duty, 24 hours before the operation of any kind of vehicle or weapon and 28 days before parachuting or serving on a military aircraft.

The only problem, of course, is being able to enforce the same. Cannabinoids, notably THC, can stay in the body for up to 30 days for casual users long after the high is over.

Athletes in Canada are still banned from using any kind of cannabis. The reason? They are subject to the Canadian Anti-Doping Program (CADP) under which the use of cannabis will still be prohibited.

That said, the Canadian Hockey League is reportedly now examining how to revise how it addresses the issue of medical use.

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Packaging Design for Cannabis Products: How to Build Trust and Gain Customers

To sell more cannabis products, you must build trust with your customers. Design Shack Magazine explains: “Trust is a key component of user loyalty, and a reason why people come to your company or brand.”

If you don’t get your package design right, people might simply ignore your cannabis products.But building trust is a big challenge for new medical cannabis businesses. That’s where good design can help:“While a lot of trust comes from past performance and a brand’s track-record, it also comes from the design. How a website, poster or package looks can impact how users feel about it and whether they take the leap from casual looker to brand loyalist.”

For a cannabis health supplement business, the product packaging design is one of the most important ways to reassure consumers and build trust.

When a prospective customer first sees your product, they see the packaging before they can touch or see the product. Good product packaging can raise concerns or instill comfort and confidence in a potential buyer.

If you don’t get your package design right, people might simply ignore your cannabis products.

So, let’s take a look at what your business can do to create great product packaging designs that will win over the skeptics and gain customers.

Include the Right Content On Product Packaging

Designing packaging that inspires trust starts with including the right content.

Start by telling people exactly what’s inside your packaging. For example, specify what your product is (CBD Extract Oil vs. Full-Spectrum Hemp Oil Caplets), how much of it there is, a production lot number and a potency level.

Include any qualifiers that may reassure your customers – such as “Organic,” “Non-GMO” or “CO2-Extracted.”

Image courtesy of Kannabia Seed Company

Communicate this information in clean, concise language that shows you have nothing to hide. And, speaking of not hiding – include contact information for your business. Many businesses bury their contact info on their websites and packaging. Don’t do that.

People trust businesses that are transparent and easy to reach. Customers want to know that if they have a question or something goes awry with an order that they can get help.

Including your web address, support email and phone number is a powerful way to reassure clients that your business is legitimate and trustworthy.

And, no packaging is complete without branding elements to help customers identify who your business is and what you’re about. This should include your company’s logo, identifying brand colors and any other small visual elements your brand may use.

Finally, make sure to follow the FDA guidelines for dietary supplement labels.

Your content checklist for product packaging

  • Include the essential details
    • What’s inside?
    • How much?
    • What’s the potency and dosage?
    • When does it expire?
    • What’s the lot number?
  • Include reassuring qualifiers that your audience will value
    • Organic, CO2-Extracted, Full Spectrum, Contains Less Than 0.3% THC, etc.
  • Include your company’s contact info
    • Web Address
    • Customer Support Email
    • Customer Support Phone number
  • Include your visual branding elements
    • Logo
    • Tagline
    • Brand Colors
    • Small branded graphic elements

Keep the Packaging Design Simple

Clean, simple design is reassuring and inspires trust.

Image courtesy of Receptra Naturals

That’s because simple design makes it easy for customers to find what they need or want to know.

It’s easy to miss information in a cluttered design – and people know this.

People naturally mistrust the dense chunks of text at the bottom of many advertisements and product packages. On the other hand, clean, easy-to-read fonts and plenty of white space ensure that your audience can read your product packaging and find the information they want quickly without too much trouble.

With fewer words and graphics competing for attention, the important stuff naturally stands out. And, a simple design also sends the message that there are no hidden loopholes or secrets that may work against your customers.

Keep the Design Of Your Product Packaging Professional

It doesn’t matter how great your product is if your business comes across as unprofessional. And, for medical cannabis businesses, the bar for establishing professionalism is even higher than for most companies.

Keep these tips in mind to communicate professionalism and reliability.

Image courtesy of Sagely Naturals

Make sure your packaging is error-free

Mistakes don’t look professional. How many times have you wondered how an error could have passed through so many hands unnoticed that it made it onto the final version?

Consumers notice errors in your packaging design. They see typos and often, discover incorrect or misleading information. Errors make customers think that your business is incompetent. Or worse – they might think that your business is deliberately misleading them. Make sure you proof-read everything before your packaging goes to production.

Showcase Your Cannabis Products Well Against Competitors

People buying your cannabis products will have other options. Don’t ignore your competition and be sure to understand how other dietary supplements and medicine is packaged.

Want to build trust by encouraging consumers to group your CBD products with other trusted medical brands? Follow these tips:

  • Provide a list of ingredients and instructions for safe dosing and usage. People expect this from reputable medicinal brands. Your product packaging should dothis too. And, remember to follow the FDA’s labeling requirements for dietary supplements.
  • Incorporate a safety seal into your packaging design. You’ll notice that most medicines, vitamins, and supplements have a safety seal to protect the contents. Whether you opt for a shrink-wrapped seal over the lid or a foil seal under the cap, adding a safety seal shows that your product has not been tampered with and implies that it’s safe to use.

Incorporating these elements will create a mental link between your product and other trusted medicinal products.

Be authentic to your cannabis brand

Last, but not least, your packaging design must align with your brand. When consumers sense a disconnect between the brand identity they’ve come to identify with your business and the packaging design for your products, it creates discomfort.

Image courtesy of Direct Cannabis Network

But packaging that is in line with (or expands upon) the brand identity consumers have come to know will create comfort and trust.

Kevin Keating at PKG Brand Design explains:

Your brand’s packaging design must reflect your company’s story, product, and values. If your packaging claims a “simple” snack product with dozens of ingredients, consumers are going to be left with a disingenuous feeling about your products and company. By ensuring that your messaging, design, and visual impact is in line with your company and your consumer’s preferences, you can build instant trust.

So, ensure that your packaging design is consistent with your existing visual identity. This includes the name of your business or cannabis product, your cannabis business logo, website, and marketing design.

A united and cohesive visual brand presence looks professional and helps to build familiarity – which is key to developing trust. Ultimately, many people judge products based solely on the product packaging. That’s why it’s essential to make sure your product packaging sends the right message.

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A Province-By-Province Look At Recreational Cannabis In Canada

Federal recreational reform is coming to Canada next month, the second country after Uruguay to take the plunge. For the first time in almost a century, in other words, cannabis is now about to be legal again.

The federal government will license and regulate the industry. However each province and territory (analogous to American states) will set the rules on distribution and sales. As a result, there is quite a bit of difference across the country with implications both for licensed producers (LPs) and consumers.

A quick guide to the general Canadian regulations broken down by Province.

Who Can Buy, Sell and Grow?

With two exceptions, the legal age of consent is 19, home growing of up to 4 plants is allowed across many provinces (with only Quebec, Manitoba and Nunavut banning the practice), and rules vary by province on both public and private consumption.

However what the industry is really looking at right now is where private enterprise will be allowed to flourish at the retail end of the industry. Private retailers will be allowed to operate in 7 provinces and territories where they will compete with government run outlets. In New Brunswick, Nova Scotia, Ontario, Prince Edward Island, Quebec and the Yukon, consumers will be required to shop in only government-run establishments.

Nunavut, with no licensed producers, will allow online sales only, even in a recreational market. This gives Tilray an instant advantage with their established online presence not only from the company website, but Leafly.However, the two largest provinces are also where the competition will be most intense nationally.

Power Provinces

One of the most interesting statistics to look at is mapping this information to the number (and size) of licensed producers in each province. For example, Ontario currently clocks in at 59 producers, British Columbia at 23, Quebec at 8 and Alberta at 6, while the Yukon, the Northwest Territories and Nunavut have none. Of these, Ontario and Quebec will not allow producers to sell direct to private establishments but rather mandate sales via government-run dispensaries.

Ontario is slated to become the largest of all provincial markets in the country with Quebec coming in second.

However, the two largest provinces are also where the competition will be most intense nationally.

Where The Big Dogs Lie

Even these statistics do not tell the entire story. The biggest producers (especially those engaged in international rather than just domestic production and distribution) are scattered all over the map. For example, Tilray is in British Columbia. This gives the company the unprecedented ability, via its online portal and information website, Leafly, to engage in direct sales to both patients (via online sales) and recreational users from its home base.

How this will shape regional sales figures once the rec market actually starts is uncharted territory.Aurora is in a similar situation as it is situated in Alberta.

Canopy is headquartered in Ontario, but has grow sites across the country, giving it wide market access, and has just been picked as one of four companies to begin recreational sales in Manitoba.

Aphria and MedReleaf headquarters are also both located in Ontario. But it is not necessarily where such producers are located which will determine market access. Ontario has opened the door to suppliers of all sizes, across the country.

Quebec, in contrast, has signed deals with Canopy, Aphria, Aurora, Tilray, MedReleaf and Hydropothecary with both Aurora and Hydropothecary expected to have large home-court advantage when it comes to branding. MYM Nutraceuticals, with a huge greenhouse in Weedon, Quebec, has now also signed the largest deal in Quebec (as of June). The company represents one of Canada’s largest greenhouses.Canopy_Growth_Corporation_logo

Prince Edward Island and Brunswick have followed a bit of a hybrid model, signing deals with both small local players and the larger national companies.

The interesting twist to the Canadian medical market (that does not exist in Europe for example) is that all licensed producers are allowed to sell directly to patients online. How this will shape regional sales figures once the rec market actually starts is uncharted territory.

Ontario, with 40% of the country’s population and home to more than half of Canada’s registered producers, is slated to become the country’s largest recreational market.

British Columbia, in contrast, is developing as a place where mom and pops can still thrive.

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GW Pharma’s Enormous Price for Epidiolex

In a fascinating early August conference call with Seeking Alpha, British-based GW Pharmaceuticals finally revealed their retail price point for CBD-based drug, Epidiolex, as it goes into distribution in the U.S.

The drug is designed for the treatment of certain kinds of childhood epilepsy – although not all kinds. Also notable of course, is that GW Pharma’s “other” drug for treatment of resistant epilepsy failed in late stage trials in Eastern Europe earlier this year. It also knocked off 5% of the price of the company’s stock.The company is estimating it has a potential patient pool of between 25,000- 30,000 patients in the U.S.

British Advocacy Over Access And Pricing

The ineffectiveness of GW Pharma’s drugs for many patients (along with the cost charged for them) was responsible for pre-empting the entire access discussion in the UK this year. The mother of an epileptic British child tried to import a personal store of cannabis oil (produced by Canadian LP Tilray) only to have it confiscated at the airport this summer. Her son ended up in the hospital shortly thereafter.

The national uproar this caused pushed forward the country’s new medical cannabis policy– indeed drug rescheduling is due to go into effect in October. Conveniently, right as Epidiolex goes on sale in the U.S. (where cannabis remains a Schedule I drug).

The company is estimating it has a potential patient pool of between 25,000- 30,000 patients in the U.S.

Price Tags and Politics

What is the price of Epidiolex? $32,500 per patient, per year. If that sounds high, the company insists it is pricing the drug to be “in line” with other drugs for this segment of the market.

The majority of this cost will not be picked up by private health insurers but rather the federal governmentActually, according to industry analysis, this is about 70% more than the price of one comparable drug (Onfi), and slightly more expensive than Banzel, the two competing (non-cannabinoid based) medications now available in the U.S. for this market.

Here is the other (widely unreported) kicker. The majority of this cost will not be picked up by private health insurers but rather the federal government, which is also not negotiating with GW Pharma about that high price  (unlike for example what is going on in Europe and the German bid).

Why the difference?

Two reasons. The first is that Epidiolex has obtained “orphan drug” status (a medication for a disease that affects fewer than 200,000 patients in the U.S.) The second is that the majority of the insurance that will be picking up this tab is Medicaid. The patient pool will be unable to afford this. As a result, the bulk of the money will remit not from private insurance companies but rather federal taxpayers. And, unlike in say, Germany, none of this is pre-negotiated in bulk.

Epidiolex-GW
What is the price of Epidiolex? $32,500 per patient, per year.

Co-payments are expected to range from $5 to $200 per month per patient after insurance (read: the government) picks up the tab. This essentially means that the company plans to base participation at first at least on a sliding scale, highly subsidized by a government that has yet to reschedule cannabis from a Schedule I in the U.S.

Creating, in other words, a new monopoly position for GW Pharmaceuticals in North America.

A Hypocrisy Both Patients And The Industry Should Fight

The sordid, underhanded politicking that has created this canna monster is hardly surprising given the current political environment in both the U.S. and the U.K. right now. The people who benefit the most from this development are not patients, or even everyday shareholders, not to mention the burgeoning legitimate North American cannabis industry, but in fact highly placed politicians (like British Prime Minister Theresa May). Philip May, the PM’s husband’s firm is the majority shareholder in GW Pharma. Her former drugs minister (with a strong stand against medical cannabis) is married to the managing director of British Sugar, the company that grows GW Pharma’s cannabis stock domestically.

So far, despite a domestic outcry over this in the UK (including rescheduling), there has been no political backlash in the United States over this announcement. Why not?

Look To Europe For A More Competitive Medical Market

This kind of pricing strategy is also a complete no go in just about every other market – including medical-only markets where GW Pharma already has a footprint.

For example, German health insurers are already complaining about this kind of pricing strategy for cannabis (see the Cannabis Report from one of the country’s largest insurers TK – out earlier this year). And this in an environment where the government, in fact, does negotiate a bulk rate for most of the drugs in the market. Currently most German cannabis patients are being given dronabinol, a synthetic form of THC which costs far less.

GW logo-2On top of this, there are also moves afoot by the German government to begin to bring the costs of medical cannabis and medicines down, dramatically. And this too will impact the market – not only in Europe, but hopefully spark a debate in every country where prices are also too high.

The currently pending German cultivation bid for medical cannabis has already set an informal “reference” price of at most 7 euros a gram (and probably will see bid competitors come in at under half that). In other words, the government wholesale price of raw, unprocessed cannabis flower if not lightly processed cannabis oil is expected to be somewhere in the neighbourhood of 3-4 euros per gram come early next year. If not, as some expect, potentially even lower than that.

Processed Cannabis Medicine vs. Whole Plant Treatment

The debate that is really raging, beyond pricing, is whether unprocessed cannabis and cannabis oil is actually “medicine.” At the moment, the status quo in the U.S. is that it is not.

GW Pharmaceuticals, in other words, a British company importing a CBD-based derivative, is the only real “medical cannabis” company in the country, per the FDA. Everyone else, at least according to this logic, is placed in the “recreational camp.” And further, hampered still, with a lack of rescheduling, that affects everyone.

If that is not an organizing issue for the American cannabis industry, still struggling with the many issues inherent in the status quo (from insurance coverage and banking to national distribution across state lines) leading up to the midterms, nothing will be.

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Are LED Grow Lights Worth It?

There really is no question that Light Emitting Diodes (LEDs) work, but just how well do they work?

For the last 50+ years, indoor cannabis cultivators have used High Pressure Sodium (HPS) lights to illuminate their flowering crops. This technology was developed for, and is still used, as street lighting and there really hasn’t been a fundamental change to the output in the last half century.LED technology showed great promise to solve some of the primary drawbacks to the use of HPS technology for indoor cannabis cultivation. 

We are often asked why this technology was used to grow cannabis, and the answers are simple: 1) due to strict legislation and even stricter penalties for growing cannabis, growers wished to move their crops indoors, and, 2) there really hasn’t been another technology that would allow us to cheaply place 400, 600, or even 1000W of light on a crop. In addition, HPS technology is rich in certain frequencies of red light, which is so important to flowering crops. Unfortunately, HPS lamps have their drawbacks, such as high heat output and lack of other “colors,” along the lighting spectrum. In fact, up to 95% of light produced by an HPS lamp is emitted in the infrared range, which we perceive as heat.

Enter the Light Emitting Diode. LED technology showed great promise to solve some of the primary drawbacks to the use of HPS technology for indoor cannabis cultivation. The ability to manipulate spectrum, precision delivery of light, elimination of dangerous heat, and lack of substantive toxic chemical makeup are a few reasons to deploy LEDs. However, as with any new technology, there were some significant hurdles to overcome.

Early experimentation using Light Emitting Diodes (LEDs) to grow cannabis, suffice to say, did not go well.  Poor performance, misleading advertising and equipment failures plagued the first mass-produced LED grow lights. The aspect of poor performance can be blamed on several factors, but the most prominent are very low efficacy, in terms of light produced per Watt consumed, and incorrect application of spectrum (color) for horticultural purposes. Causes of “misleading advertising” was a mixed bag of dubious sales pitches and lack of understanding the technology and of horticultural lighting requirements. Additionally, there certainly were some quality control issues with LEDs and electronics equipment in general, especially from offshore manufacturers in China and Korea.

A plant in flowering under an LED fixture

That legacy of poor performance still has a partial hold on the current indoor cannabis cultivation industry. Many of the current “Master Growers” have tried LEDs at some point and for the various reasons mentioned above, reverted to HPS lighting. Some of this reluctance to embrace LEDs comes from unfamiliarity with application of the technology to grow better cannabis, while some can be attributed to stubbornness to deviate from a decades-long, tried-and-true application of HPS lighting.

Certainly, growing with LEDs require some changes in methodology. For instance, when using true “full spectrum” grow lights, more nutrients are consumed. This is caused by stimulation of more photoreceptors in plants. To further explain, photoreceptors are the trigger mechanisms in plants that start the process of photosynthesis, and each photoreceptor is color/frequency-dependent. True full spectrum LED systems fulfill spectrum shortages experienced with HPS technology. Anyone that grows with LEDs will at some time experience “cotton top,” or bleaching at the upper regions of their plants.  Increased nutrient delivery solves this issue.

As we continue to uncover the vast medical potential of cannabis, precise phytochemical composition and consistent quality will become all-important.While the industry is still saturated with confusing rhetoric and some poorly performing equipment, LEDs are gaining momentum in the cannabis market. LED efficacies have increased to levels far greater than any other lighting technology. Broad spectrum white and narrow-frequency LEDs in all visible (and some invisible to the human eye) colors are being produced with great precision and consistency. Quality control in manufacturing is at an all-time high and longevity of LEDs has been proven by the passage of time since their introduction as illumination sources.

As the world embraces LED horticultural lighting, probably the most encouraging news is that current and upcoming generations of cannabis growers are more receptive to new ideas and are much more tech-savvy than their predecessors. Better understanding of cannabis-related photobiology is helping LED grow light manufacturers produce lighting that increases crop yields and perhaps more importantly, cannabis quality. As we continue to uncover the vast medical potential of cannabis, precise phytochemical composition and consistent quality will become all-important.

Obviously, the indoor cannabis industry is expanding rapidly and this expansion raises deep environmental concerns. More power is being used for indoor lighting, and for the cooling required by this lighting. Power systems are being taxed beyond forecasts and in some cases, beyond the capabilities of the infrastructure and power companies’ ability to produce and deliver electricity.  Some states have proposed cannabis-related legislature to limit power consumed per square foot, and some are specifically requiring that LEDs be used to grow cannabis. While some business leaders and cultivation operators may groan at the acquisition cost and change in operating procedures when deploying LEDs, common sense states that it is imperative we produce cannabis applying the most environmentally friendly practices available.

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How to Vet Suppliers in Cannabis Product Manufacturing

The quality of your edible cannabis product can only be as reliable as the components that comprise it. The three types of components include active ingredients (such as CBD oil), packaging components  (such as the bottles that hold finished product) and inactive ingredients (such as coconut oil). When evaluating a potential supplier for these three areas, a risk-based method follows a vendor selection process that highlights critical ingredients and also adequately assesses excipients. With this approach, the vetting process for a supplier is based on the impact the potential ingredient or component will have on the quality and purity of the finished product.

Choose only those suppliers who can provide certification that the packaging components are food-grade or food-safeThere are three basic categories to guide vendor assessment. Is the supplier providing 1) a packaging component with product contact, 2) an excipient, or inactive ingredient, or 3) the active ingredient? Regardless of the category, due to the factious nature of cannabis, it is important to first verify with a vendor that it will sell its products to a company in the cannabis industry. Once that is determined, the evaluation process may begin.

Packaging Components

Sourcing validation is a critical initial step in the production process. (image credit: Lucy Beaugard)

Packaging components, such as bottles and caps, are considered primary packaging because they have direct contact with the finished product. Suppliers of the primary packaging must be able to provide assurance that their goods do not contain additives that are harmful to consumers. Therefore, choose only those suppliers who can provide certification that the packaging components are food-grade or food-safe. Reputable vendors will also be able to provide a certificate of compliance, also known as a certificate of conformance, which states that the component meets specifications required for that part. Many cannabis regulations require finished products to be sold in child-resistant packaging, so the supplier will need to provide child-resistant certification for the packaging components, if applicable.

Excipients

Excipients are ingredients that are added to a product for the purposes of streamlining the manufacturing process and enhancing physical characteristics such as taste and color. Some examples could include coconut oil, starch and alcohol. Though they do not have the same critical nature as active ingredients, their potential risk to a finished product is generally greater than that of a packaging component. As such, there are additional factors to consider for an excipient vendor. Verify with the supplier that it can provide the following documentation. While governing regulations may not require some information, the data included in these documents are important to ensure the quality of your finished product.

  • Certificate of Analysis (or, certificate of conformance), for each lot of material. The information on a certificate, including the tests performed, specifications and test results must be sufficient to determine if the material is acceptable for use in the product.
  • Allergen Statement. This statement is important to accurately include or disclaim allergens on the finished product label.
  • Residual Solvent Statement. Solvents are commonly used to bolster the manufacturing process for a material. In order to maintain acceptable levels of residual solvents in a final product, it is necessary to also consider the toxicity and level of each solvent in the raw material.
  • Heavy Metals Certification. Since metals pose a risk to consumer safety, it is important to know what amounts, if any, are being contributed to your product by raw materials.

Because changes in an excipient can impact your finished product, make every attempt to obtain a commitment from a supplier to notify you if changes are made to the excipient’s specifications.

Active Ingredients

Cannabis oil is the ingredient that, when the edible cannabis product is consumed, is biologically “active.” Thus, it is considered to be the active ingredient in cannabis products. Since cannabis oil has a direct impact on the quality of a product, it is critical that the oil supplier be appropriately evaluated. One of the main considerations for a cannabis oil supplier is whether the supplier is willing to host initial and periodic audits of its manufacturing facility. Such audits are crucial in assessing the capability of the vendor to comply with regulatory requirements and established procedures – can the supplier consistently provide quality material? The answer to this question is too important to risk for you and your customers.As anyone working in the industry has experienced, anything related to cannabis is placed under an unprecedented critical lens.

Additionally, verify the oil supplier will provide key documentation, such as that listed above for excipients, to support the quality and purity of the oil. And last but not least, ensure the information reported by the supplier is adequate to meet the requirements of your finished product.

Evaluation guidelines and criteria such as these should be added to standard operating procedures to ensure consistency and quality across all products. As anyone working in the industry has experienced, anything related to cannabis is placed under an unprecedented critical lens. The importance of consumer safety and bolstering industry integrity is paramount. Sourcing validation is a critical initial step in the production process that can directly impact a company’s success and longevity in the cannabis industry.

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Distillation Of Your Cannabis Extract: Ignorance Is Not Bliss

In a previous article I discussed the elephant in the room for clients of laboratory services- the possibility of errors, inaccurate testing and dishonesty.

Now, I will explain how the current “smoke and mirrors” of distillation claims are impacting the cannabis industry in the recreational and medical areas. We have all heard the saying, “ignorance is bliss.” But, the ignorance of how distillation really works is creating misinformation and misleading consumers.

That is, just because a cannabis extract has been distilled, doesn’t mean it is safer.There have been reports of people claiming that “Distilled cannabis productsthat are Category 2 distillate are pesticide free and phosphate free, while Category 1 has pesticides and phosphates, but within acceptable limits”

The problem is that these claims of Category 1 and Category 2 cannot be proven just by saying they are distilled. Ignorance of the physical chemistry rules of distillation will lead to increased concentrations of pesticides and other organic contaminants in the supposedly purified cannabis distillate. That is, just because a cannabis extract has been distilled, doesn’t mean it is safer.

So, let’s look at a basic physical chemistry explanation of the cannabis distillation process.

  • First off, you must have an extract to distill. This extract is produced by butane, carbon dioxide or ethanol extraction of cannabis botanical raw material. This extract is a tarry or waxy solid. It contains cannabinoids, terpenes and other botanical chemicals. It will also contain pesticides, organic chemicals and inorganic chemicals present in the raw material. The extraction process will concentrate all of these chemical compounds in the final extract.
  • Now you are ready to distill the extract. The extract is transferred to the vacuum distillation vessel. Vacuum distillation is typically used so as to prevent the decomposition of the cannabinoid products by thermal reactions or oxidation. Under a vacuum, the cannabinoids turn into a vapor at a lower temperature and oxygen is limited.
  • Part of the vacuum distillation apparatus is the distillation column. The dimensions of this column (length and width) along with the packing or design (theoretical plates) will determine the efficiency of distillation separation of each chemical compound. What this means is that the more theoretical plates in a column, the purer the chemical compound in the distillate. (e.g. Vigreux column = 2-5 theoretical plates, Oldershaw column = 10-15 plates, Sieve plate column = any number you can pay for).
  • The temperature and vacuum controls must be adjustable and accurate for all parts of the distillation apparatus. Failure to control the temperature and vacuum on any part to the apparatus will lead to:
    • Thermal destruction of the distillate
    • Oxidation of the distillate
    • Impure distillate

Now, you can see that a proper distillation apparatus is not something you throw together from a high school chemistry lab. But just having the proper equipment will not produce a pure cannabis product. The physical chemistry that takes place in any distillation is the percentage a chemical compound that occurs in the vapor phase compared to the percentage in liquid phase.So, how can you produce a cannabis distillate that is clean and pure?

For example, let’s look at whiskey distillation. In a simple pot still, alcohol is distilled over with some water to produce a mixture that is 25%-30% ethanol. Transferring this distillate to an additional series of pot stills concentrates this alcohol solution to a higher concentration of 85%-90% ethanol. So, each pot still is like a single theoretical plate in a distillation column.

But, if there are any chemical compounds that are soluble in the vapor produced, they will also be carried over with the vapor during distillation. This means that pesticides or other contaminants that are present in the cannabis extract can be carried over during distillation!

So, how can you produce a cannabis distillate that is clean and pure?

  • Produce a cannabis extract that has lower concentrations of bad chemicals. Since a lot of the cannabis extracts available for distillation are coming from grey-black market cannabis, the chances of contamination are high. So, the first thing to do is to set up an extraction cleanup procedure.
    • An example of this is to wash the raw extract to remove inorganic phosphates. Then recrystallize the washed extract to remove some of the pesticides.
  • Make sure that the distillation apparatus is set up to have proper temperature and vacuum controls. This will limit production of cannabis decomposition products in the final distillate.
  • Make sure your distillation apparatus has more than enough theoretical plates. This will make sure that your cannabis distillate has the purity needed.
  • Finally, make sure that the staff that operates the cannabis distillation processes are well trained and have the experience and knowledge to understand their work.

Inexperienced or under-trained individuals will produce inferior and contaminated product. Additional information of extract cleanup and effective vacuum distillation can be obtained by contacting the author.

The post Distillation Of Your Cannabis Extract: Ignorance Is Not Bliss appeared first on Cannabis Industry Journal.

The Awakening Green Giant: China and Cannabis

There are many ironies along the path towards global cannabis legalization. Too many to count. But surely one of the oddest was always going to be the reacceptance and relegalization of cannabis in China.

The path so far has been, at a minimum, tortured.

Ritualistic, religious, and medical use of cannabis is mentioned in Chinese texts as early as 3,000 years B.C. and medical literature for the last 2,000 years. Fast forward through Imperial dynasties, the western Age of Empire and exploitation, a cultural and political revolution and two world wars, and it took China until 1985 to actually declare cannabis “illegal.”

Flag_of_the_People's_Republic_of_China.svgDuring the 19th Century British occupation, the majority Muslim Xinjang region of the country was a major cannabis producer (and exporter) to British India.This was done legally and under tariff until 1934 when the communist government cut off legal trade.

Currently,punishment for possession yields10-15 days jail time and a 2,000-yuan (approximately $300) fine. Illegal sales, however, carry the death penalty. Last year, China executed 10 people convicted of drug trafficking in a public space to send a strong statement about the launch of a new anti-drug campaign. It certainly sent a message.

But to Westerners, in particular, a highly confusing one.

So where is the “market?” And how and where is cannabis being slowly reintroduced to the country in the age of global reform?In 2003, they issued regulations to normalize the industry.

Hemp Is Widely Farmed

Farmers in the northerly province of Heilongjiang province, near Russia, are producing hemp legally these days – bound for industrial, medical and edible commercial use. The crop is highly profitable for farmers – bringing in about USD $1,500 per acre.This is far more than other crops like corn. Chinese authorities had, until earlier this century, turned a blind eye to its production. In 2003, they issued regulations to normalize the industry.

This production region also accounts for half of all farmland currently under legal hemp production, globally.

That is not a typo.

More Than Half Of Global Cannabis Patents Are Chinese

During the 20th Century,as cannabis reform moved on, not to mention western medical knowledge expanded about the plant, no surprise, the Chinese government began to lend support to a burgeoning industry and medical research. That also began surprisingly early. During the Chinese involvement in the Vietnam War during the 1970’s, the government needed a source of cheap clothing material for soldiers. They also needed cheap, accessible medicines with strong anti-bacterial properties, particularly in the humid jungle.

Given the highly politicized nature of the plant itself, not to mention current geopolitical developments shaping the global industry, Chinese exports are likely to stir a global conversation.Approximately half of the world’s 600 cannabis patents are now held in China, rivalling the potential of Israel on both the cannabinoid medicine and medical device front.

These days, there is a greater appreciation than ever for “traditional” Chinese medicine,long stigmatized by Western approaches to the same, far from China. The discovery of the so-called “endocannabinoid system” of the body by Israeli scientists at the turn of the century also supports this sea change. Including not only the use of cannabisbut other natural herbs and procedures like acupuncture to stimulate it.

The Chinese domestic medical cannabis trade, in other words, is ready to take off in the world’s largest greying population. The horse has, obviously, left the barn in the West.

But what does all this mean for non-Chinese competitors not only in Chinabut outside of it, as the drug heads for export crop status?

Cannabis Trade Wars Are In The Offing

Given the highly politicized nature of the plant itself, not to mention current geopolitical developments shaping the global industry, Chinese exports are likely to stir a global conversation.

President Donald Trump’s administration, it should be remembered, allowed a British CBD import to enter the U.S. pharmaceutical market this summer (while still banning all U.S. producers from entering the same thanks to delays on rescheduling domestically). It is not an unreasonable prediction to make, certainly after Trump also struck a deal with Israeli President Benjamin Netanyahu to delay the date of Israeli medical cannabis to the rest of the world in exchange for political support in moving the nation’s capital from Tel Aviv to Jerusalem.

A U.S. “ban” on Chinese-sourced cannabis would be one of the most natural responses in the world for the current American administration, which has not only used the cannabis trade card before (Israel, UK) but has yet to move on rescheduling the drug at home.

What To Expect If Considering Importing

Tread carefully. While Europe (at least to North Americans) has its eccentric quirks when it comes to international business, the situation in China is far different.Tread carefully, and find local partners where possible. 

Beyond appalling penalties for getting the paperwork (or etc.) wrong, there aremany differences in business, medical and even broader culture that are completely foreign to Westerners (in particular).

Tread carefully, and find local partners where possible. Where to meet Chinese partners?

Chinese investors are beginning to enter particularly European markets via conferences. In the past several years, while they are still a trickle, Chinese doctors, investorsandscientists have begun appearing in the West. Particularly in more medically oriented forums in Europe.

The post The Awakening Green Giant: China and Cannabis appeared first on Cannabis Industry Journal.

Are Global Cannabis Markets Moving In Synch?

In American political lingo, an “October Surprise” is an event or incident that is deliberately planned to impact a political election – usually during a presidential year.

The cannabis industry, of course, is still highly political – starting with reform itself.

So what to make of the fact that over the course of the summer, three major markets have started to align in terms of timing?

Canada, Germany and The UK Moving In Synch?

None of these things were original, publicly planned or announced, of course. During July, the Canadian government finally announced the recreational market start date, the German government issued its new cannabis cultivation bid (due in October), and of course, the British government announced that they would reschedule cannabis and create more access for British patients.Canadian companies, for example, are perfectly poised to enter both markets and dominate the industry

What is in the air? And could this, in any way, be a deliberate cannabis industry power play by political forces in motion right now?

The Canadian-German Connection

Planned or not, it is certainly convenient that the much stalled German cultivation bid will now be due right at the time that the Canadian rec market goes into hyper drive. Why? The largest Canadian LPs are currently dominating the European market. These companies are also widely expected to take home the majority of the tender opportunities and are already producing and distributing across Europe.

For this reason, it is unlikely that there will be any “shortages” in the market in terms of deliverable product. However, larger Canadian cannabis companies have already announced that a certain percentage of their stock will be reserved for medical use (either at home or presumably to meet contract commitments that now stretch globally). Inefficiencies in the distribution network will be more responsible, at least in the short term, for consumer “shortages” rather than a lack of availability of qualified product.

Regardless, the connection between these two markets will generate its own interesting dynamics, particularly given the influence of both the Canadian producers and the size of the German medical space on cannabis reform as well as market entry.

The German-British Connection

Germany and the UK are connected historically, culturally, and now on the topic of cannabis reform. While it is unlikely in the short term that German-produced cannabis would end up in the UK, British grown cannabis products are available across Europe, including Germany, in the form of drugs developed by GW Pharmaceuticals.

In the future, given the interest in all things “export” in both economies, this could be a fascinating, highly competitive market space. Whether or not Brexit happens.

The British-Canadian Connection

While not much has emerged (yet) from these two commonwealth countries now embarking on the cannabis journey, it could certainly be an interesting one. This starts with the major competition GW Pharmaceuticals now faces at home from external (Canadian in particular) companies looking to expand their reach across Europe.

Whether Britain Brexits or not could also impact the pace of market development here. Particularly as cannabis supplies can be flown in (via Heathrow), or shipped via the Atlantic, thus missing the Channel crossing point and literally parking lot delays on major motorways.GW logo-2

Canadian cannabis companies could also decide to build production sites as the market matures in the UK.

As it emerged earlier in the year, the UK is also the world’s top cannabis exporter – ahead still of the entire Canadian export market. Do not expect this to last for long after October.

However, in one more intriguing connection between the markets, Queen Elizabeth II in the UK must sign the final authorization for the Canadian recreational market to commence. With a new focus on commonwealth economies,if Brexit occurs, cannabis could certainly shape up to be a major “commonwealth crop.”

Much like tea, for that matter.

The common language between the two countries also makes international business dealings that much easier.

But What Does This All Mean For The Industry?

The first indication of this synching phenomenon may well be simply market growth on an international level unseen so far.

Canadian companies, for example, are perfectly poised to enter both markets and dominate the industry simply because this odd calendrical synching is also very convenient for business,

British companies coming online in the aftermath of rescheduling will also be uniquely positioned, no matter the outcome of the now looming divorce agreement between the parties. Whether the first market beyond domestic consumption is either commonwealth countries or the EU (or both in a best case scenario), the British cannabis market is likely to be even more globally influential than it already is.

The German market may also, depending on the pace of patient growth and cultivation space, become the third big rival, particularly with the near religious fervour all exports are worshipped here.

In the more immediate future, Germany is actually shaping up to be the most international market. Established companies from Canada to Israel and Australia are clearly lining up to enter the market one way or the other. And all that competition is starting to predict a seriously frothy, if not expanding, market starting now with connections that stretch globally.

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Food Safety Consortium To Address Cannabis Safety, Edibles Manufacturing

The 6thAnnual Food Safety Consortium Conference & Expo will feature an entire track dedicated to cannabis this year. As announced back in May of this year, the Cannabis Quality series will feature presentations by subject matter experts in the areas of regulations, edibles manufacturing, cannabis safety & quality as well as laboratory testing.

The Food Safety Consortium itself is hosted by our sister publication, Food Safety Tech, but the Cannabis Quality series will be co-hosted by Cannabis Industry Journal as well. A number of cannabis-focused organizations will participate in the series of talks, which are designed to help attendees better understand the cannabis edibles market, regulations surrounding the industry and standards for manufacturers.

Ben Gelt, board chairman at the Cannabis Certification Council (CCC) will moderate a panel discussion where leaders in the edibles market will discuss supply chain, production and other difficulties in manufacturing infused products. That panel will include Nancy Whiteman, CEO of Wana Brands, Jacob Pasternack, CEO of Binske, Justin Singer, CEO of STI Brands, alongside other leaders in the infused products and edibles markets.

Radojka Barycki, CEO or Nova Compliance, will discuss the role of food safety in the cannabis industry and identify some biological and chemical hazards in cannabis product testing in her talk, “Cannabis: A Compliance Revolution.” Larry Mishkin, counsel to Hoban Law Group and partner at the law firm, Silver & Mishkin, which serves cannabis businesses in Illinois, will also be speaking earlier in the conference.

Cameron Prince, VP of Regulatory Affairs, The Acheson Group
Cameron Prince, VP of Regulatory Affairs, The Acheson Group

Cameron Prince, vice president of regulatory affairs at The Acheson Group, will help attendees better understand key market indicators and current trends in edibles manufacturing during his talk on November 15th. “With the current trend of legalizing cannabis edibles, medicinal and recreational suppliers alike are looking to quickly enter the edibles market,” says Prince. “Understanding the nuances of moving to food production relative to food safety, along with navigating the food industry’s regulatory environment will be critical to the success of these companies.”

Tim Lombardo and Marielle Weintraub, both from Covance Food Solutions, will identify common pathogens and areas where cross-contamination can occur for edibles manufacturers as well. This year’s event will be held November 13-15 in Chicago, Illinois. To see the full list of speakers and register for the conference, go the Food Safety Consortium’s website.

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