Cannabis Labeling - Navigating an Emerging Industry
Not to sound trite, but cannabis is confusing. It exists in a patchwork of legality – legal for medical use in 28 states, for both recreational and medical use in 8 states (plus D.C.), and entirely illegal on a federal level.
Each state where cannabis is legal has different requirements for sellers – where and how to label things like the kind of strain you’re selling, the THC content, and warnings (e.g. “this product is illegal for sale to children and adults under the age of 21.”) The nationwide market for cannabis is still very much an experiment-in-progress, and so cannabis sold in closely adjacent states may have vastly different labeling requirements.
Cannabis regulations in individual states aren’t always intended solely to protect and educate the consumer. In some states, they’ve been enacted to present a high barrier of entry to businesses looking to set up shop. Witness the case of Massachusetts, where cannabis has been legal since July 1st, 2018 – but no businesses are projected to start selling it until at least September.
Navigating an emerging industry has always been fraught with risk, but the emerging cannabis industry (which is still technically illegal) is fraught with legal risk as well. Let’s explore how sellers of this product can use labeling to educate customers and satisfy regulators.
Mapping the Cannabis Supply Chain
Cannabis may change hands a number of times between cultivation and consumption. Depending on the state of sale, each stage in the supply chain will entail different forms of packaging.
Cultivators and Processors
Cultivation is where it all starts. Cultivators grow the cannabis flower that’s at the root of the supply chain. Importantly, cannabis is not ready to be used as soon as it’s harvested. It needs to be processed – dried, trimmed, packaged, and labeled. Sometimes, the same organization will grow, process, and sell their own cannabis flower straight to the consumer – a vertically integrated operation. Other times, the cultivator and processor will be separate entities.
In California, one of the largest and oldest markets for cannabis, a new marijuana labeling and regulatory regime known as the Medicinal and Adult Use Cannabis Regulation and Safety Act (MAUCRSA) requires cultivators and processors to place their products in a tamper- and child-resistant package, label it with a tracking identifier, and add a product warning in a uniform font. Additionally, cultivators and processors must add the weight, date of cultivation, date of packaging, list of ingredients, and more.
Compare these requirements to another market. Massachusetts – one of the newest states to allow recreational cannabis sales – has been implementing its rules on a slower basis. The regulatory regime was only finalized as of March 15th, and rules on products intended for on-site consumption (such as in cafes) remain in the draft phase. Here are some labeling highlights from the final regulations:
- Cannabis for recreational use cannot be labeled with images of cannabis, medical symbols, drug paraphernalia, or colloquial references to the product (i.e. “weed”).
- Product artwork should not have any elements that would make it attractive to minors
- Packaging and labeling must be approved by the Cannabis Control Commission (CCC). The CCC may charge a fee for pre-approval.
- Must have an approved warning label saying either “Contains THC” or “Not Safe For Kids.”
Lastly, in all states where cannabis is legal, there are cases where a cultivator or processor might not sell their product directly to the public. Instead, they transfer their products to a manufacturer, who may convert the dried flower into an edible, an oil, a cannabis resin, or other cannabis-derived product.
In these cases, the cultivator or processor must still package and label the cannabis product with information such as the name and contact information of the cultivator, the quantity of cannabis within the package, date of packaging, batch number, and cannabinoid profile. In addition, the label must still contain warning boilerplate.
Primarily, a cannabis manufacturer will take processed cannabis flower and then convert it into an edible product. Although a lucrative product – edibles can account for up to 60% of dispensary profits – the creation of this product is complicated from a regulatory perspective. Edible cannabis lies at the confluence of two strict regulatory regimes – medical/recreational cannabis and food and beverage.
In Massachusetts, edible labels must firmly state that the edible is a marijuana product. California requires a similar label, but the wording there is “Cannabis-Infused.” Manufacturers must state whether the product must be refrigerated, how much it weighs, how much cannabis is in it, the cannabinoid profile, and more. In Massachusetts, there’s a firm upper limit of 5 mg of THC per serving for edibles, and the package cannot contain a dose of more than 100 mg of THC in total.
Lastly, the packaging should conform to some standards common in the F&B industry. It must disclose an ingredient list, state common allergens, include a batch number, and print the “use-by” or “best by” date.
Cannabis Distributors and Retailers
Like cultivators and processors, cannabis distributors and retailers can be found either as vertically integrated organizations or as separate entities. In California, separate retailers have barely any power to label goods. All they must do is ensure that their product leaves their premises in an opaque package (similar to the brown paper bags purveyed at liquor stores.) Distributors also have limited roles – they may only package or label products if they’re also manufacturers – and only if they’re dealing with products that they themselves have manufactured.
On the other hand, Massachusetts retailers are allowed to package goods – and distributors aren’t recognized as a separate class of license-holder. In the near future, cannabis retailers in Massachusetts will even be able to distribute their products directly to customers’ homes. Although these regulations have not been finalized, it seems likely that there will be no difference in packaging requirements between cannabis packaged for delivery and cannabis sold only in storefronts.
Navigating Cannabis Labeling Requirements
This article is by no means a comprehensive look at the regulatory labeling requirements for cannabis in states where it is legal. Although there are commonalities between states – nearly all require a warning label, child-proof packaging, and dosage information – the differences are big enough that cannabis-associated organizations can’t confidently use a single label format across every state where the drug is legal for use.
Many states, such as Washington, are rolling out state-operated cannabis traceability programs. Like any state-operated system, however, such rollouts are often prone to bugs. In Washington state, for example, their vendor-operated traceability system made it impossible for users to log in, provide inventory manifests, or accept shipments. As such, it’s best for individual operators to implement a backup record keeping system, both to smooth the way for inevitable product recalls and make up for failures in statewide record keeping data.
In this complex environment, it’s critical to have a labeling platform that ensures consistency, maximizes flexibility and meets complex labeling variations to ensure compliance. This is necessary considering the varying regulatory environment in each state where cannabis products are being sold. No matter which state you’re selling in, traceability should also be of paramount importance – a feature which the right Enterprise Labeling Solution would be well-equipped to enable. Additional advantages of implementing a comprehensive Enterprise Labeling Solutions include:
- Automated label variations
Changing requirements, changing regions and changing regulations all impact your labeling. Enterprise Labeling gives you the power to master labeling variations by automating and applying advanced logic to your labeling processes. You can maximize support for countless label combinations and make mass changes quickly to comply with changing cannabis laws and customer requirements.
- Master changing regulations
In this highly-regulated marketplace, you must be able to consistently keep pace with evolving regulations. Enterprise Labeling allows you to comply by making label changes to formats, barcodes, logos, languages, and content including quickly and easily adding industry-specific warnings, product information and even color to meet global and regional requirements.
- Adapt to scale
Cannabis is a fast-growing industry. Make sure you can adapt to overnight success with a labeling solution that has the flexibility to increase print volumes, meet new business requirements and scale to new regions.
Although cannabis is a new industry in many respects, that doesn’t mean your rollout has to be fraught with regulatory concerns. With the right Enterprise Labeling Solution, you’ll be able to meet both customer and regulatory requirements without worrying about non-compliance or any high barriers to entry.
For more on Enterprise Labeling and how it can aid the pharmaceutical industry, check out our Enterprise Labeling for Dummies eBook.