California's cannabis industry is experiencing some test anxiety.
The state Bureau of Cannabis Control reported this week that almost one of every five products submitted for testing under new regulations that took effect July 1 have failed. It's news that underscores the growing frustration among growers, distributors, manufacturers and retailers.
"Testing is currently costly, slow and inconsistent, and affects every aspect of the regulated market," the California Growers Association wrote in a letter to the bureau urging regulatory changes it says will give the newly above-board industry a chance at competing with its entrenched illicit counterpart. "Accordingly, measures to increase testing capacity and reliability, while protecting public safety, should be a top priority for the (bureau)."
According to the bureau, laboratories have tested 11,000 samples since July 1, almost 2,000 of which have failed. In the vast majority of those failed tests — 65 percent — there was nothing wrong with the samples themselves. They weren't contaminated by pesticides or mold. Rather, the test results failed to meet claims on their labels, with THC content being the most common discrepancy.
State regulations imposed similar rules as those in play for food and beverages in the state. For example, if you buy a beverage that boasts 25 percent real grape juice on its label, product tests have to come within 10 percent of that mark, meaning the beverage would have to test at between 22.5 and 27.5 percent grape juice.
Similarly, if a cannabis product boasts 25 percent THC content, the lab results need fall within that 22.5-to-27.5-percent range. But lots of products are failing to hit the mark, meaning they need to be relabeled with accurate claims, which is adding costs and delaying the flow of cannabis products to dispensary shelves.
About 5 percent of cannabis products failed tests due to unacceptable levels of pesticides, bacteria and mold. Some of these products can be remediated and re-tested with the hope of reducing contaminants below state thresholds. Others had to be destroyed.
According to a breakdown by the Associated Press, it seems flowers have fared best in the state testing process, with 90 percent of samples passing. That number dropped to 80 percent for concentrates and about 66 percent for edibles.
But as the letter from the California Grower's Association attests, frustrations with state testing requirements run deeper than bad results.
There are currently only 34 state-licensed testing laboratories in California, which has created a testing bottleneck that has slowed products' path to dispensary shelves. There have also been questions about the laboratories' accuracy, with some instances of identical samples fetching divergent results from different labs, prompting at least a couple high-profile product recalls (See "Brave New World," Aug. 2).
The association, however, cites high testing costs as one of its larger concerns, saying the regulatory framework hurts smaller growers and encourages monoculture.
To make this point, the association's letter offers an example: Under the current system, a harvesting of 15 pounds each of three different cannabis strains is required to have all three tested independently "even if all three strains were harvested from the same premises at the same time." But the state allows testing of batches of up to 50 pounds, meaning the same grower would be required to pay for only a single test if he or she had opted to plant only a single strain.
In order to reduce testing costs, the association is asking the state to allow "compositing," or submitting multiple strains as a part of the same testing batch, which it estimates could yield cost savings of up to 40 percent for some growers and help ease the bottleneck at testing laboratories. And the association reminds the bureau that living up to its mandate of protecting public health inherently means squeezing out the black market.
"As the regulated market struggles to compete with illicit competition, practical and financial costs of compliance are a major factor," the association's letter states. "If the regulated market fails, the state will not realize its goals for public safety, environmental sustainability or tax collection."
Thadeus Greenson is the Journal's news editor. Reach him at 442-1400, extension 321, or [email protected]. Follow him on Twitter @thadeusgreenson.