California’s Cannabis Regulation Roller Coaster

California’s Cannabis Regulation Roller Coaster

By: David Plafchan

Working in California’s cannabis industry is not for the faint of heart, and 2018 has been a mind-boggling year of dealing with ever-changing testing, packaging and labeling requirements.

At Papa & Barkley, a science-focused creator of medical-cannabis wellness and lifestyle products, Chief Product Officer Guy Rocourt told me that product testing remains a major challenge for many in the industry. “I appreciate the good intentions for ensuring clean products,” says Rocourt “but some of the testing regulations have not been fully thought out and are inconsistent with federal standards established for other industries. The regulations on medicine, food and liquor often pale in comparison to the standards California is imposing on the cannabis industry.”

As an example, Rocourt discussed ingredients found in infused products like edibles and topicals. Many non-cannabis organic ingredients are failing the lab-required pesticide testing. “We had a batch of pain balm held up by regulators due to a common ingredient found in beeswax. Infused products need to be reconsidered from a testing standpoint, since they are mixed with other ingredients. Standards for those ingredients should be consistent with what is generally regarded as safe throughout the country. Plus, the pesticide limits applied to our balm is set to the same standard as something you ingest, which is unique to our industry,” says Rocourt. Instead of shifting to artificial ingredients to solve the problem, Papa & Barkley found organic ingredients that will pass rigorous California standards.

Cannabis Industry Regulations

 

Case in point is beeswax, which is used in Papa & Barkley’s topical pain balm. Average organic beeswax fails the testing requirements the industry has set in place. “No other industry has the same standards around their products,” says Boris Shcharansky, COO at Papa & Barkley. “Our operations team had to search nationally to find the cleanest beeswax available just to pass the test. While we ultimately found a solution, the beeswax is so natural it takes 4 times as long to melt and filter out impurities, which adds 12-16 hours to our process.”

Packaging compliance and re-labeling are other examples of the industry’s regulation woes playing out in real life. When packaging regulations first changed in July of this year, Papa & Barkley spent considerable time and money developing multi-use child-resistant packaging, only to see emergency regulations then eliminate the requirement. “They told us that all infused products needed to be childproof, so we spent the money on R&D to do it right, only to then get clarity that a topical can have a one-time child proof solution like a shrink sleeve,” said Shcharansky. “This type of environment makes it hard for us to buy packaging in large quantities.”

Cannabis Testing Regulations In California

 

For additional perspective I spoke with Josh Kirby, the CEO of Kinslips, a manufacturer of cannabis-infused sublingual strips and edibles. Josh said “There is no end in sight. Every time the state releases a new round of regulations it feels like Groundhogs Day. You learn a lot about yourself being in this industry when you’re struggling to overcome. Do you stop, or do you solve it?”

“Working with the labs is another challenge we’re facing. Testing is expensive, and if you’re testing large batches, you run the risk of your product failing, thus putting large amounts of inventory in limbo. “Your product can fail if it’s off by a decimal point,” says Josh. “The problems with labs are three-fold, no standards, no oversight, and false positives”.

Rocourt had a similar concern: “The labs wield too much power. It’s concerning when you send samples to different labs and get inconsistent results.” He also took issue with how the regulations require products to be tested as finished goods. “They make us test finished goods, which in some cases means an infused product in a sealed jar. If that product fails everything needs to be discarded and that creates a lot of waste. Even dispensaries are unclear on accepting tested products, and disputes are happening in real-time with little clarity on the proper channels to go through to work things out.”

Beyond the financial impact, packaging changes and testing logjams are impacting consumers who are finding fewer products on the shelf.  “People rely on our products and are now finding it harder to get access to their medicine. Medical patients have really been overlooked in this process, and that seems wrong” added Shcharansky.

With no true resolution in sight for the near future, the only constant they are counting on at Papa & Barkley is change. And in the case of California’s constantly evolving cannabis regulations, change isn’t always good.

California Proposition 65

California Proposition 65

What are the requirements of Proposition 65?

Proposition 65 requires that the Governor of California maintain and publish a list of harmful chemicals. The list is updated annually and includes chemicals that can be found in solvents, drugs, dyes, food additives, by-products of certain processes, pesticides, and tobacco products.

A chemical is listed if it has been classified as a reproductive toxicant or carcinogen by an “authoritative” organization on the subject. The U.S. Environmental Protection Agency, U.S. Food and Drug Administration, National Institute for Occupational Safety and Health, the National Toxicology Program, and the International Agency for Research on Cancer are considered authoritative for carcinogens. For reproductive toxicants, the authorities are the U.S. Environmental Protection Agency, U.S. Food and Drug Administration, National Institute for Occupational Safety and Health, and International Agency for Research on Cancer. Chemicals will also be listed if they are required to be labeled or identified as a carcinogen or as a reproductive toxicant by an agency of the state or federal government.

Understanding Prop 65

Why has Papa & Barkley placed a Proposition 65 label on its products?

Any company with 10 or more employees operating or selling products within the State of California must comply with the requirements of Proposition 65. To comply, businesses are: (1) prohibited from knowingly discharging listed chemicals into sources of drinking water; and (2) required to provide a “clear and reasonable” warning before knowingly and intentionally exposing anyone to a listed chemical.

A Proposition 65 warning means that the business has evaluated the exposure and has concluded that it exceeds the “no significant risk level,” or that the business is providing a warning based on the presence of a “listed” chemical without actually evaluating the exposure.

Papa & Barkley is providing a warning based on our knowledge about the presence of one or more listed chemicals without attempting to evaluate the level of exposure. While using a Papa & Barkley product, the exposure to a “listed” chemical may be well within the “no significant risk” range, but out of caution, we have placed the Proposition 65 warning labels on our products.

Are consumers who are using a Papa & Barkley product with a Proposition 65 warning at risk?

 

The California government states: “The fact that a product bears a Proposition 65 warning does not mean by itself that the product is unsafe.” The government also explained, “You could think of Proposition 65 more as a ‘right to know’ law than a pure product safety law.”

A Proposition 65 warning means that the product contains one or more listed chemicals. By law, a warning is required unless the business proves that the exposure to the chemical poses “no significant risk.” The “no significant risk” level for carcinogens is defined as the level which is calculated to result in not more than one excess case of cancer in 100,000 individuals exposed over a 70-year lifetime. Therefore, if you are exposed to the chemical in question at this level every day for 70 years, theoretically, it will increase your chances of getting cancer by no more than 1 case in 100,000 individuals so exposed.

The “no significant risk” level for reproductive toxicants is defined as the level of exposure which, even if multiplied by 1,000, will not produce birth defects or other reproductive harm. Therefore, the level of exposure is below the “no observable effect level,” divided by 1,000. (The “no observable effect level” is the highest dose level which has not been associated with observable reproductive harm in humans or test animals.) For further information about California’s Proposition 65, please visit http://oehha.ca.gov/prop65/background/p65plain.html

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