Start by understanding what works and what doesn’t work.

 By Josh Swider | September 4, 2020

Opinions expressed by Entrepreneur contributors are their own.

The cannabis industry has a testing problem — and it may not be going away anytime soon. Why? Inexperienced technicians, unscrupulous labs, outdated testing regulations, and inferior testing equipment all factor into the inconsistencies and false results that plague the business.

But there is some hope. By taking action now to fix issues in cannabis testing, we can ensure consistent testing results, guarantee the integrity of products on dispensary shelves, and, ultimately, protect cannabis consumers’ health. This includes creating reasonable and effective action levels for contaminants like pesticides in cannabis products.

How we got into this mess

When medical marijuana burst into California in the late ’90s, the government did not hold businesses to the same testing and manufacturing standards as more established industries like foods and supplements. As entrepreneurs flocked to the rapidly growing cannabis market, their businesses ran the spectrum from professional manufacturing facilities to home kitchens and garage operations. This lack of quality control created a minefield of safety concerns for cannabis consumers.

After more than a decade of no regulatory oversight, California’s legal cannabis industry suddenly found itself subject to restrictions put in place to protect consumers. Among these additions was mandated cannabis lab testing that examined both cannabinoid content and residual contaminants like pesticides and solvents.

Soon testing labs began popping up in markets throughout California to meet the significant demand created by legalization. Some of these were existing labs staffed by exceptional technicians who were unfortunately hindered by never working with cannabis before. But others were simply savvy players who saw a cash cow and took advantage of the opportunity, even if it meant cutting corners to increase profits.

State regulators oversee the cannabis market, including testing labs. Still, a report released by the California Department of Finance revealed that, among other difficulties, “the current status and location of personnel is not sustainable to provide effective and comprehensive oversight of cannabis activities throughout California.” This is directly due to funding issues and difficulties in hiring and training staff.

The House of Representatives is defending state and tribal-legal cannabis industries.

 By A.J. Herrington | July 31, 2020

The U.S. House of Representatives voted on Thursday to approve an amendment to a defense spending bill that prohibits the federal government from spending money on investigating and prosecuting cannabis activities that are legal under state or tribal law. The wide-ranging amendment, proposed by Democratic Rep. Earl Blumenauer of Oregon, is similar to spending restrictions placed on federal agencies to protect legal cannabis that have been passed each year since 2014.

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Josh Swider, the CEO of Infinite Chemical Analysis Labs in California, explained how seizures of cannabis samples at a U.S. Customs and Border Patrol checkpoint (which is actually about 20 miles from the border with Mexico) have negatively impacted his business.

“For the past few months, we’ve had to halt business in Imperial County due to tensions between state and federal regulations,” Swider said. “With the inability to transport legal cannabis samples across state highway checkpoints, our clients in this region were unable to have their products analyzed for consumer safety required to get their products to market.”

“The passing of this measure would be a huge step in the federal government recognizing cannabis as a legal business and would allow licensed cannabis operators in federally-restricted regions, like Imperial Valley, the opportunity to flourish in this industry,” he added.

Growers and distributors in Imperial County and San Diego often have to go through Border Patrol checkpoints en route to testing facilities or markets. Sometimes, they say, Border Patrol will let them through. But other times, those agents confiscate products.

 By Jesse Marx and Maya Srikrishnan | June 29, 2020

Legal cannabis and hemp business owners say that Border Patrol checkpoints between Imperial and San Diego counties are costing them millions.

Growers and distributors in Imperial County and other parts of Southern California often have to go through Border Patrol checkpoints en route to testing facilities or to bring them to markets farther west. Sometimes, they say, Border Patrol will let them through, checking their state license without problem. But other times, those agents confiscate products and cash.

“It’s been affecting us negatively,” said Angel Fernandez, director of Movocan Inc., which operates a dispensary in Imperial County and has a distribution permit. “We have missed on a lot of revenue because it’s uncertain that our cannabis product will make it out of the county.”

It is the inevitable consequence of different governments treating the same substance in two completely different ways. California voters legalized medical cannabis in the ‘90s and for recreational purposes in 2016, but the federal government continues to prohibit it and treat it like a schedule one narcotic.

Even as cities in Imperial County open to more cannabis businesses, some investors have balked at the opportunity. Others have begun to petition law enforcement at the local, state and federal levels with the hope that they might work out a more practical system to let the legal cannabis trade continue between San Diego and Imperial counties without the constant risk of one’s product and cash getting seized.

But even if the cannabis industry does see some additional leeway on the ground, others don’t think the issue will ever fully be resolved until federal law changes.

Though the stops have been happening for years, people who work in the legal industry started seeing an uptick in late 2019.

In November, Border Patrol confiscated 10.36 pounds of cannabis, amounting to roughly $35,000 in retail value, Fernandez said. He spent days trying to get his product back.

“There was no way, no documents I could file,” he said.

Fernandez said he estimates that the uncertainty the Border Patrol checkpoints have caused him a total loss of between $3 and $4 million. On top of the loss of products during seizures, many distributors have stopped coming to the area because of interactions with Border Patrol.

Preview:

Heavy T: Was it a lack of scientific data for cannabis? There was a lot of hearsay, a lot of ‘folklore’ around medical cannabis. We knew that if you consumed cannabis, it had certain relief elements. But because it’s been federally illegal, we can’t get the big research behind it at universities and stuff you may see with other industries. With that lack, I’d think it would be something that would be noticeable to you. Josh S: Definitely. So when I was finishing up grad school, that’s when these issues were kinda put in front of my face. I started to see a lot of newspaper articles about analytical labs and the testing industry for cannabis. It was a pay-to-play market- anyone that wanted a high result for their flower, they wanted 38% flower, they’d just pay a lab extra money. It was almost a disrespect to the analytical testing industry and the cannabis industry at the same time, and that’s what I was focused on. I wanted to bring the right answers and try to connect the two sides.”

Skip to interview: 41:30

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