Metrc Takes Contract for Maine’s Tracking Software

Maine’s Office of Marijuana Policy (OMP), the government agency in charge of regulating their cannabis industry, announced today a six-year contract for traceability software with Metrc LLC. According to the press release, the software will be used for the newly formed adult use market, which is just a few months away from going live with legal sales.

Maine’s OMP was previously under contract with BioTrackTHC as their software provider before switching to Metrc with this new contract. The software is cloud-based and uses radio-frequency identification (RFID) tags on plants and products to track cultivation and distribution of cannabis products throughout the state. The software is commonly used across the country in states that have legal cannabis markets. It essentially prevents diversion to the black market, allows for a transparent supply chain with clear chain of custody tracking and it increases recall readiness.

Erik Gundersen, Director of Maine’s OMP, says Metrc is helping to make a smooth launch of the adult use market. “We are excited to partner with Metrc,” says Gundersen. “Metrc is an industry leader, and their team is committed to delivering a product that will allow us to proceed with the launch of our adult use program later this spring.”

Over the next few months, Metrc and OMP plan on helping the industry familiarize themselves with the new software. The two organizations will go on the road in March, giving licensees training and answering questions. Metrc will then offer online training and evaluations followed by credentialing licensees showing they are proficient with the software.

Jeff Wells, CEO of Metrc, says they are excited to get to work. “We’re excited to partner with the OMP to help launch the state’s adult-use marijuana market,” says Wells. “2020 is another significant year for cannabis industry growth, and we look forward to serving the OMP, local cannabis businesses, and the people of Maine.”

The agreement is a six-year contract with a value of roughly $540,000. License holders pay a $40 monthly fee to access the system, which helps support training and technical support, according to the press release.

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Massachusetts Lifts Ban On Cannabis Vaping Products

Cannabis regulators in Massachusetts have modified a ban on marijuana vape products that will allow businesses to begin selling newly manufactured goods as soon as retailers can get them on the shelf. However, vape products manufactured before December 12 will remain under a quarantine imposed by the Massachusetts Cannabis Control Commission (CCC) on November 12.

Under the amended quarantine order, medical marijuana treatment centers and adult-use dispensaries will be permitted to sell devices that vaporize cannabis flower or concentrates provided that they comply with new regulations.

November’s quarantine order was issued in response to the outbreak of lung illnesses that has been dubbed e-cigarette or vaping product use-associated lung injury (EVALI) by health officials. In its ongoing investigation of the lung injuries, the Centers for Disease Control and Prevention has identified vitamin E acetate as a toxin of concern.

Shawn Collins, the executive director of the CCC, emphasized that the new regulations, which were put in place in the interest of consumer safety, only apply to products purchased from licensed retailers.

“These protections exist in the legal market,” he said. “They do not exist in the illicit market.”

New Rules Push Transparency

Dispensaries that carry cannabis vaping products will be required to post a warning and disclaimer to consumers that reads “This product has been tested for contaminants, including Vitamin E Acetate, with no adverse findings. WARNING: Vaporizer Products may contain ingredients harmful to health when inhaled.” The warning must also be contained on an insert provided with vaping products.

Amanda Rose, the president of cannabis retailer New England Treatment Access, said that the new regulations will help advance consumer safety and confidence in licensed cannabis businesses.

“[The commission’s decision] is really a win for our customers and our patients who can now have access to a product that has been tested, that’s well regulated, that comes with accurate information about what’s inside those products, and that really drives them back into the regulated market and away from the illicit market,” she said.

Businesses selling cannabis vaping products “will be required to list their active or inactive additives, including the amount infused or incorporated during the manufacturing process, including thickening agents, thinning agents, and specific terpenes,” according to Thursday’s announcement from the CCC. Regulators are also requiring transparency on the parts used in vape pens and other devices, which “will be required to include a written insert that identifies their manufacturer, battery, and other known components, and discloses the materials used in their atomizer coil. This information will be required to be included in product lists posted on the licensee’s website and other third-party applications as well.”

David Torrisi, the executive director of industry group the Commonwealth Dispensary Association, applauded state regulators in a statement.

“Today’s ‘lifting’ of the quarantine order on cannabis vaping products by the CCC’s Executive Director Shawn Collins is reflective of the thorough, thoughtful, collaborative, and evidence-based approach he has led the CCC through,” he said.

Cannabis companies in Massachusetts can begin producing vape products that comply with the new regulations. But before they can be sold they’ll have to be lab tested, a process that usually takes three to five days, according to Michael Kahn, the CEO of licensed cannabis analytic laboratory MCR Labs.

“If we have a huge onslaught, of course it’ll take longer,” he said. “We’re doing our best.”

The post Massachusetts Lifts Ban On Cannabis Vaping Products appeared first on High Times.

Canadians Spend Nearly A Billion Dollars On Recreational Cannabis In First Year Since Legalization

It’s been a little over a year since Canada legalized recreational weed across the entire country. Throughout that year, a lot has changed and evolved in the country’s legal cannabis industry.

Now, new stats show exactly how much Canadians have spent on recreational weed. According to the new numbers, which come from Statistics Canada, the country as a whole spent just under $1 billion in year one of legalization. That works out to be roughly $24 per Canadian.

New Stats Put Number on High Demand for Legal Weed

The new data covers October 2018—the month that weed became legal in Canada—through September 2019, covering almost one year exactly.

In that time frame, Canadians spent $907,833,000 on recreational marijuana. This number is helpful, as it puts a specific amount on what had previously been recognized only very generically as a year of very high demand for recreational weed.

Recreational cannabis officially became legal in the country on October 17, 2018. Right away, there was massive demand. So much so, in fact, that shops and online retailers around the country started running out of product.

In the months immediately following legalization, there were predictions of months-long supply shortages. Many of those concerns came from the fear that cultivators and producers wouldn’t be able to harvest fast enough to restock shelves at retailers.

Based on a province by province breakdown of purchases, demand was the highest in Yukon. There, per capita sales came in at $103 per person. Prince Edward Island was the second highest. The average in that territory was $97 per person.

On the other end of the spectrum, British Columbia had the lowest per capita purchases, coming in at an average of only $10 per person.

Brick and Mortar vs. Online Retailers

One of the interesting details highlighted in the new stats is the difference between brick and mortar retailers and online sellers.

In some provinces, the only place to purchase legal weed is on province-run websites. Meanwhile, other provinces allow for brick and mortar shops to sell legal weed.

Taken as a whole, Canada saw a steady increase in the number of brick and mortar stores throughout the first year of legal weed.

Specifically, Statistics Canada said there were 217 physical retail stores in March 2019. Just a few months later, in July 2019, there were 407 brick and mortar shops.

Interestingly, access to physical retailers appeared to draw a significant portion of business away from online sellers.

More specifically, stats show that as the number of brick and mortar shops increased during the year, the market share of online sales fell from 43.4 percent in October 2018 all the way to 5.9 percent in September 2019.

“While online cannabis retail ensures access to all Canadians regardless of proximity to a physical store, accessibility continues to improve as more stores open across the country,” the report said.

How close people live to a retail store varies province to province. That’s especially true in remote portions of Canada.

But across the board, Statistics Canada said that roughly 45 percent of Canadians live within 10 kilometers of a cannabis shop.

On top of all this, other reports show that Canada’s illicit market remains active.

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The CalCannabis Appellations Project Is About to Spark a New Chapter in Place-Based Branding

Connoisseurs know that pairing a fine cut of steak with a Napa Valley cabernet sauvignon is a sure winner. But how many are aware that pairing strawberry cheesecake with a certified Santa Cruz Blue Dream cannabis strain creates an equally delicate palatal synergy? Thanks to the California Department of Food and Agriculture’s CalCannabis Appellations Project (“CAP”), premium cannabis regions will soon have the potential to capitalize on such newfound awareness among discerning consumers.

For decades, cannabis connoisseurs have been willing to pay a premium for flower said to have been grown in certain regions or with certain techniques, but because of cannabis’ legal status, supply chains have been opaque. As a result, cultivators of distinct cannabis strains struggled to capture the full market potential of their products. That has begun to shift with implementation of California’s Cannabis Track-and-Trace System. The costs associated with implementation of the METRC1 system have been bemoaned by many in the industry, but there is also tremendous potential value in having the most transparent supply chain in the world. The CalCannabis Appellations Project is the vehicle through which brands will be able to harness that value.

The underlying premise behind the CalCannabis Appellations Project is that the distinctive qualities of a cannabis product are often attributable to where and how the plant is grown. Through this project, CalCannabis is developing a statewide appellations system2 that will allow qualifying licensed cultivators to effectively communicate information about their cannabis crops (i.e., the standards, practices and/or varietals used) through labels, advertisements and other marketing techniques. It will also prevent disingenuous cannabis cultivators from making inaccurate claims about where and how a product is grown, which protects the integrity and value of the appellation.

What is an appellation?

In general terms, an appellation is an identifying name, title or label that can be legally defined and protected. Appellations are most commonly used in the wine industry to geographically identify the origin of grapes in a particular bottle. This place-based identification system comes from an understanding that certain regions have unique environmental and growing characteristics, which result in a product that cannot be produced from other regions even when the same varietals are used. Famous wine appellations or American Viticultural Areas (AVAs) in California include the Napa Valley and Santa Ynez AVAs, and sub-AVAs such as the Russian River Valley AVA, located within the larger Sonoma County AVA.

Recognizing there are also growing regions that produce uniquely distinctive cannabis, CalCannabis is developing a process for:

  1. Establishing an appellation (i.e., identifying regions that produce distinctive cannabis and defining standards, practices and/or varietals that must be used in those regions to qualify for an appellation); and
  2. Qualifying to use a particular appellation once they are established (i.e., determining the cannabis cultivators that can legally label or market themselves as belonging to a particular appellation).

While the state has not released program details, it’s likely that cultivators will have to demonstrate their outdoor-grown cannabis is distinctly unique.3 CalCannabis has until Jan. 21, 2021,4 to establish these processes, but a draft is expected to be released by early January 2020.5 This is an opportunity for cultivators to organize and participate in the process to define and create unique local appellations.

What are the benefits of an appellations system?

Napa wine country
Image: James Faulkner, Flickr

Appellations benefit both cannabis cultivators and consumers. It allows small farmers to capture the value that consumers place on unique and local cannabis products. Allowing for product differentiation through an appellations system will prevent cannabis from becoming a commodity—a situation that could result in indistinguishable products and a single market price for cannabis regardless of how or where it is grown. Thus, an appellations system protects not only local economies and farming communities, but also consumers that care about the origin and growing practices of their cannabis.

A criticism of appellations, particularly in the wine industry, is that they can disincentivize innovation and industry growth when strict growing practices and standards are required to be a part of an appellation. This will be an important consideration as CalCannabis establishes its appellations system.

County of Origin

In addition to setting up an appellations system, the CalCannabis Appellations Project will expand upon current county of origin regulations. Unlike an appellation designation, the county of origin designation is designed to be much more inclusive—it can currently be used on any cannabis product as long as 100% of the cannabis is grown within the designated county.6 Whereas an appellation will communicate information about the quality of a cannabis product and how it was produced, a county of origin designation is more like a “Made In” label. For example, a county of origin designation can be applied to indoor cannabis whereas an appellation will likely only include sun-grown cannabis.

There is also a desire to allow city of origin designations in addition to county of origin designations, which would enable products grown wholly within the political boundaries of a city to further differentiate themselves.7 As the legal cannabis landscape changes nationwide, it may also be important to have a statewide appellation allowing products to be marketed as “Grown in California.

What should cannabis cultivation regions be doing now?

After CalCannabis releases a draft process for establishing an appellation, the next steps will be clarified. However, not everyone is waiting. For instance, growers in Mendocino County have already started to organize.8 The Mendocino Appellations Project divided the county into 11 unique subregions based on regional growing conditions and practices that could potentially be turned into appellations in the future. The goal of the appellations outlined by the Mendocino Appellations Project is to protect cannabis products coming out of Mendocino County and preserve the region’s growing heritage.

A group in Sonoma County is also discussing the establishment of appellations with the hope that it will help differentiate their cannabis and draw attention to the unique microclimate and soil structure in parts of Sonoma County.9 The groups involved in these discussions also believe it will allow cultivators to develop strict growing standards and to protect certain strains, while creating new jobs and encouraging agritourism. Appellations will become increasingly important as sophisticated consumers begin to select quality cannabis that aligns with their preferences.


References

  1. METRC is the third-party-owned software contracted by California authorities to implement the commercial cannabis track-and-trace system “from seed-to-sale.”
  2. Passage of Senate Bill 185 calls for the use of the term “appellations of origin” instead of “appellations.”
  3. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  4. Business and Professions Code Section 26063.
  5. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  6. Business and Professions Code Section 26063(a).
  7. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  8. https://swamiselect.com/mendocino-appellation-project/
  9. https://www.sonomacountygazette.com/sonoma-county-news/cannabis-appellations-the-small-cannabis-farmers-elyon-cannabis.

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Khiron Life Sciences Makes Strategic Moves In South America

Khiron Life Sciences Corp. has played an interesting game globally for some time now. Far from a “high flier” in the first tiers of Canadian cannabis companies to watch, that may be changing. Not to mention, this fall, what exactly do these labels mean right now as almost all the first movers retrench and reconsider?

How and where Khiron’s influence will be felt however, is still very much a question in the air.

The big news? The company has obtained authorization from the Colombian government to commercialize high-THC cannabis, and further, for both domestic and international consumption.

There are several interesting things about this announcement.

The first is that Khiron inevitably got its domestic license to supply a 15,000-patient trial “at home” in Columbia (and for the prestigious Latin American Institute of Neurology and the Nervous System).

The second is that the company will also be exporting – and to where.

Uruguay is at the top of that list – starting with the fact that the country has had a “recreational market” that actually predates Canada’s. To import medical cannabis here in other words, is also an interesting statement in and of itself. Namely, what is wrong with domestically produced Uruguayan product? Even and especially in this case, for the medical market? (The answer of course has more to do with U.S. banking law than product quality).

The second is the UK where the company will also supply the patient trial there – Project Twenty21. This is even more intriguing considering that the NHS has just denied the efficacy of cannabis for treating neurological conditions and pain and only recently agreed that Sativex was “cost effective” after negotiating a lower bulk price with GW Pharmaceuticals made possible by the new NICE guidelines.

The third is Brazil – a growingly valuable market now firmly on the radar of those watching all things cannabis-related in the hemisphere.

Regardless, it shows that the lights are on in the executive suite at Khiron. The question is, will this early mover advantage pay off – and more interestingly, where?

A Hemispheric Play – But In Which Long Term Direction?

While the UK at least seems to be Brexiting itself off a cliff of free trade agreements with the world (and expect cannabis to be in the early room of conversation about commodities in this regard), is Latin American cannabis really price impactful in low price per gram Europe long term? Especially given the inclinations of a company whose CEO admits in press statements that he wants to be a “Starbucks of Cannabis” – selling not coffee beans at “80 cents a pound…” but rather a cup of coffee “for four dollars.”

That is a still-to-be answered question. Especially in an environment where the German government has announced its essential reference wholesale price for floss at €2.30 per gram (around four dollars American). Not to mention what is going on domestically in countries across the continent from Denmark and Portugal to Poland.

However, what all this positioning also does of course, is pose questions for Khiron’s intentions throughout the American hemispheres, both more locally and of course north of the Rio Grande (in the U.S. market) not to mention Canada.

This is the kind of reverse hemisphere play of course that everyone in North America has been expecting since Uruguay’s early market movement earlier in the decade. The great South American fruit and veg market is finally allowed to turn to legal production in the form of cannabis.

Is the “Drug War” finally in its last, dying days? The answer appears to be yes. Trade wars, inevitably, however, are looming. Protectionism in the cannabis industry may be a new flavour of the day but not in any other agricultural or indeed any other kind of commodity. And on this front, things are also likely to be fierce.

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