With the Democrats currently holding the Senate, House and White House, advocates have their hopes high that the federal government will legalize cannabis. If that were to happen, businesses in the cannabis space would have to deal with a myriad of regulations that legal businesses in other industries have been dealing with all along.
For instance, if the federal government legalizes cannabis and allows national and global sales, companies in the space will have to adhere to Global Manufacturing Practices (“GMP”). GMP is a set of cleanliness and safety protocols that manufacturers of consumer packaged goods are required to follow.
GMP certification can be quite expensive, with companies spending up to six figures to ensure their production facilities are compliant and to hire a certifying firm to confirm that the company is actually adhering to GMP requirements. According to Summer LaForce, director of Woodburn, Oregon-based hemp extraction company FSOil, cannabis and hemp firms looking for opportunities in the mainstream market will need this certification despite the hefty price tag. Depending on the kind of products sold, authorities will maintain different sets of GMP.
The first thing a cannabis business should determine is if the products they make could be categorized as food, cosmetics, dietary supplements or even pharmaceuticals. If the marijuana or hemp operation doesn’t involve any extraction or production of finished goods, owners should look at Good Agricultural and Collection Practices. These standards are set by the World Health Organization as well as the United Nations, and they cover everything from sanitation protocols to harvesting, drying and storing plants that are meant to be consumed by humans.
The entire process of getting a GMP certification is quite complicated, so owners should probably bring in an expert. The expert will examine the manufacturing and safety protocols that will need to be followed as well as ensure that all products are safe for human consumption. A few of the things an expert will check include the cleanliness and hygiene of manufacturing areas, ventilation and airflow, staff training protocols, and plans for recalling products deemed unsafe, among others.
Once the consultant has compiled a gap audit, which is looking for any gaps in the manufacturing procedures that should be fixed, the business can start working toward being GMP compliant. Note that a gap audit will cost a few thousand dollars. John Davis, chief technology officer for Entexs, says sometimes the cost can go as high as three times what companies project. However, he adds that it is ultimately the smart thing for most companies to do as more and more customers are getting curious about GMP requirements.
Companies such as Pac Roots Cannabis Corp. (CSE: PACR) (OTCQB: PACRF) (FSE: 4XM), which are based in Canada, started manufacturing with federal legalization of cannabis already in place. That could mean they have fewer legal complexities to contend with than their U.S.-based multistate operators, which have different legal regimes governing them in every state in which they are licensed.
NOTE TO INVESTORS: The latest news and updates relating to Pac Roots Cannabis Corp. (CSE: PACR) (OTCQB: PACRF) (FSE: 4XM) are available in the company’s newsroom at http://cnw.fm/PACR
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