Last week saw us cover the perils of being an analytical laboratory in California’s year-old legal cannabis market, but labs certainly weren't the only ones facing the challenges of the state’s new standards for clean cannabis.
This week we’ll cover the the perspectives of the rest of the supply chain, with a dash of lab insight from one of the experts looking in.
Testing delays are reminiscent of airport delays, in the way a cascade effect can start quickly once there is a backup, but instead of not making your next flight, your kush isn’t making it to the shelf. For dispensaries, distributors and hash extractors, these missed connections proved to be an expensive hassle in 2018, at varying costs depending on how well you did selecting your lab. The best-case scenario for many was a week's turnaround time on testing; worst case, the lab lost its business permit, voiding its results in the state’s first recall.
The consultant's perspective
Savino Sguera has been at the heart of cannabis lab testing industry for years, leading to his current role as chief science officer for Digamma Consulting, where he helps labs get off the ground from the buildout to staff training. He gave his reflections on 2018.
“I think a big part of it is the quality control guidelines that are in place are something a lot of these labs never had to deal with before,” Sguera says. “The regulations are very specific about the guidelines that had to be followed, and a lot of people weren’t prepared for that. I think that was a big cause of the slowdown and making things take a lot longer.”
Sguera says that often the delays would mount up as a result of surprise inspections from the Board of Cannabis Control. The BCC would find problems and then tell labs they couldn’t issue any more proof of analysis to their clients until they could prove their practice to be in compliance. The most major action took place when Sequoia Analytics Lab lost its business license after a lab director falsified pesticide reports. Twenty-nine companies were swept up in the recall and forced to pay to retest their products.
“I was not surprised at all,” Sguera says. “I had spoken to Sequoia, and that scientist, about a year and a half ago. We didn’t get into that depth of a conversation but I was like, 'Hey, I see you guys got bought out and you’re opening up and we want to help.'”
Sguera had looked at the spread of tests that Sequoia would be offering and mentioned the lab might need some help with method development and quality control guidelines so it could get certified under the new regulations. Sequoia told Sguera they’d do fine and pointed to the scientist they had hired.
“But I’d known by looking at their website previously and from people that had used them that they didn’t have the correct instrumentation to do types of analysis that were required under the new BCC regulations,” Sguera says.
Sguera says you simply must bite the bullet and buy at least another half-million dollars' worth of equipment and there is no way around it. But he doesn't believe that the established cannabis labs had much of an advantage in the process in general.
“They had an advantage in that they had a lot of their other methods developed, like how do we test for cannabinoids, test for terpenes, all this stuff,” he says. “But when it comes to pesticides and in general the quality management, keeping track of all the information and everything that gives your lab results legal defensibility in court, I think they were just as behind as everybody else.”
Dispensaries work to keep their shelves stocked
Alternative Herbal Health Services founder Jason Beck has jumped through all the hoops up to this point in new cannabis regulations. After doing what it took to keep his West Hollywood shop alive through Proposition D, SB 420 and now Proposition 64's licensing process, he hasn't been impressed with the testing rollout in California.
“I just feel it’s amazing our cannabis is more scrutinized over the test results than our food is. And I’m all for safe clean meds as well, but I do feel there is a dramatic overreach,” Beck says.
He feels the testing standards are overly strict when the reality is that people like him have operated for decades without testing requirements and no one had a problem. “So it’s not like all of a sudden there is this big bad cannabis plant and it’s so toxic,” Beck says.
He admits there are sketchy companies out there, but asks where do we draw the line of common sense? “There are a lot of bad operators and bad people that don’t care about that. So there is definitely a need for [testing],” he says.
Beck says getting clean cannabis used to start with dispensaries' purchasing teams, but he's not sure most people who purchase cannabis for stores truly know what they're looking at.
“I’m not sure they know what the traits are for something grown with PGRs, which are plant growth regulators known to cause cancer when you smoke them. So those are things we definitely need to be protecting against, but a lot of this other stuff, I mean powdery mold is one of the things that’s very rampant in the cannabis space and among cannabis plants,” Beck says. “And the reality of it is mildew doesn’t get tested for. Yes, they test for mold, but powdery mildew is not something, to my understanding, that they test for. When that’s something that actually prevalent.”
Beck says the No. 1 thing is having an amazing relationship with the lab. “That way you guys are always first in, first out. That’s really the goal with a good testing lab, is your turnaround time.” Beck says he's heard of people having up to 10-day turnaround times, while he tends to get his results in three to four days.
“But you have to realize cannabis is a plant that is always constantly deteriorating,” Beck notes.
Previously, when cannabis was sold, growers would throw it in a bag and take it straight to the dispensary. Now it has to be prepackaged, then tested, and quarantined while it’s tested.
“If you don’t have an amazing relationship with your lab, then it takes a week to get back your test results, and that product has diminished from its original quality in that week,” Beck says. “And I’m not saying it’s a crazy big diminishment, but overall by the time it gets to the retail floor and then the hands of the customer, that could be an extra two or three weeks.”
Beck believes most consumers care about freshness and quality in a product, especially now that they're able to see the processing or harvest date on products. “That is going to be a new thing of people saying, 'I don’t want to buy that because it’s too old.' When before it was, if it smelled good, they were buying it.”
Flow Kana started organizing Emerald Triangle farmers years ago, and now has transformed into one of the biggest cannabis distribution companies in the state with its wide selection of old-school gardens on board. According to Michael Wheeler, Flow Kana vice president of policy initiatives, “Labs, just like any other business, need to grow their market share. If they take chances with business practices to capture market share, it may have major ramifications beyond just their company if it doesn’t work out. “We saw this play out multiple times throughout 2018. Unfortunately, smaller companies may not be able to withstand the business or reputation impact created by repeatedly extended wait times or a forced recall for lab testing.”
One of the places that would be most scrutinized in the new age of legal cannabis would be the hash producers. First Class Concentrates founder Barreto Nery had a love-hate relationship with labs in 2018. He says clean products are great stuff, but the scale of testing is hitting even award-winning producers like him hard.
“This kind of testing is not cheap and has been another hurdle for all operators,” Nery says. “The higher the testing cost, the bigger the average batch size gets, and that makes it harder on processors to keep that craft quality that many of us pride ourselves on.”
The pot will be cleaner when we get there, but you can see why cannabis this safe was the road less traveled until it was mandatory.