In conjunction with Rocco Petrilli – Chairman, National Cannabis Risk Management Association and Alex Hearding – Chief Risk Management Officer, National Cannabis Risk Prevention Services.
To date, most of the claims and litigation around cannabis products have been predicated largely on allegations of contamination, mislabeling and testing failures that have resulted in product recalls, consumer class actions and alleged state regulatory violations or violations of consumer protection statutes. Testing failures place additional financial burdens on businesses because products that do not pass state testing requirements either are not allowed to be sold to the public or the product’s value is reduced because of the cost of remediation. We expect that industry risk management advancements, along with the adoption of uniform standards for cultivation, manufacturing and testing, will help to drive down future liability for contamination, label inaccuracies, testing failures and similar claims. To be fully effective, these risk management activities should be formal, complete and – most importantly – embraced by cannabis companies at all levels of management.
Contamination issues primarily involve pesticides (as well as herbicides and fungicides), solvents, heavy metals and microbiological contaminants. The cannabis industry has been hampered by the fact that the Environmental Protection Agency (EPA) does not regulate cannabis due to its Schedule 1 status, and therefore has provided the industry with no helpful scientific recommendations for pesticides and other agricultural chemicals. There has been little research on the risks of heating and inhaling pesticides used on agricultural products. States have therefore been left to make their own recommendations on chemicals that should be used or avoided. California and Colorado, in particular, have played a leading role in the development of state-issued cannabis pesticide recommendations. In lieu of federal participation, the active engagement of additional states and the adoption of formal risk management