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Cannabis Recalls: Cause for Panic or Just Good Corporate Citizenship

Posted by Jessica McElfresh, Esq. | Aug 17, 2018 | 0 Comments

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Last month, two California cannabis companies, Lowell Herb Co. and Bloom Brand,  voluntarily recalled products, making retailers pull the affected products off the shelf.  Are such recalls about to become common, or is this an isolated event?

The Recalls

The Bloom Brand recalled four products sold in early July for containing myclobutanil, aka Eagle 20 (the state bans using myclobutanil on cannabis because heat converts the fungicide to hydrogen cyanide).  The move affected nearly 100 retailers throughout California. Bloom recalled the product after lab testing showed mixed results, meaning that it was not clear if the product passed or failed. On July 27, 2018, Lowell Herb Co. began a separate voluntary recall for prerolls, making seventy-four retailers remove the product.  The exact issue with the prerolls is not public, but we do know that lab testing requirements helped show the issue. Lowell had tested the cannabis flower used in the prerolls, getting a clean result. But, when the distributor tested the product, the testing lab first said the product was safe, only to change its mind two weeks later.  By then, the distributor had sent the product to retailers. A third lab cleared the prerolls, but Lowell decided to voluntarily recall the product in an abundance of caution.

Will Recalls Be Constant?

Following these recalls, many in the cannabis industry have wondered aloud if recalls will now occur regularly.  The answer is likely no. As discussed in last month's newsletter, cannabis businesses are adjusting to new testing regulations, as well as mandatory lab testing at the distribution stage.  Hiccups are going to happen and will likely smooth out over time. For example, while we do not know how myclobutanil got into the recalled Bloom product, licensed businesses in Colorado have had batches of cannabis test positive for myclobutanil months after they stopped using the fungicide.  The cause was that the mother plants used had been grown with myclobutanil. California businesses have noticed that flower can test cleanly, only to fail when turned into a concentrated product. The cause then can be that concentrating the cannabis also concentrated the pesticides, leading to a failed batch.  

Are Lab Testing Methods the Cause of Different Results?

Though it is too early to know the exact cause of these recalls, they may demonstrate the need for more consistent procedures for testing labs.  Lab testing is a crucial part of the supply chain and ultimately California will have the most stringent testing requirements for cannabis in the nation.  Despite these benchmarks, the California cannabis industry does not recommend or impose standard methods for labs to use. Instead, different licensed labs use different procedures.  Though we cannot know, it is possible that these different procedures are yielding different results. Both Bloom and Lowell recalled product after confusing lab results, and in Lowell's case, different results from different labs.  

Effect on Licensing

We do not yet know if the state will punish Bloom or Lowell for the failed batches or the voluntary recalls.  However, one hopes that the state will consider that Bloom and Lowell issued these recalls voluntarily and publicly.  The state should encourage cannabis businesses to act voluntarily to ensure product quality and public safety. Barring evidence that Bloom or Lowell were grossly negligent or flouted the state's regulations, the state should not discipline these companies.  Punishing a business for a voluntary recall could encourage future companies to issue recalls only under threat – and that is not an outcome anyone should want.

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