Early sales for recreational edibles loom as pot industry matures
In January, the Emerald spoke with Eugene-based entrepreneurs in the marijuana industry whose businesses were soon to undergo dramatic changes during the Oregon State Senate session in February. Here, we revisit these businesses, as they are pressed to meet new production standards from the Oregon Health Authority and edibles are evaluated for quality standards before they become available on the market for Oregonians 21 and older later this year.
Earlier this year, Ross Mills and Regan O’Reilly of Eugene-based business Echo Electuary, were entrepreneurs who produced honey sticks and honey-ginger chews and a cinnamon-cacao honey spread, all infused with marijuana’s psychoactive chemicals THC, CBD, or some combination of both for their medical marijuana patients. But business abruptly halted by mid-March.
The Oregon Health Authority issued a notice that possession of any cannabinoid oil extraction that is unlicensed or unregistered is now considered a Class B Felony.
“Everybody freaked out,” said David McNicoll, owner of the Eugene-based Dave’s Space Cakes. “It basically shut down the extract industry.”
As the marijuana industry becomes a more legitimate business in Oregon, the question of how marijuana-infused edibles fit into the equation is still being disputed. Edibles — a commodity that previously had no real oversight in Oregon prior to 2016 — are being scrutinized and driven through quality standards before they’re put on shelves for public retail in the next few months.
The OHA’s notice — a result of House Bill 4014, signed by Governor Kate Brown on March 3 — suspended all businesses that created medical and recreational oil extraction, which constitutes a significant portion of edible producers in the industry.
The problem was that the health authority’s licensing application — which included a fingerprint scan and background check — did not open until April 1. This made for an awkward interim that forced all extract producers to discontinue business, or make their edibles with concentrates or cannabutter (a butter-marijuana mixture).
The health authority ruled that anything produced since March 1 was expired or couldn’t be sold. Mills, who’d just sold several products to dispensaries around Portland prior to this news, was asked by those same dispensaries to take the products back. She then had to retrieve the products and reproduce Echo Electuary’s entire line of edibles with a concentrate instead of an extract.
McNicoll added that despite the declaration of the felony, it’s virtually unenforceable by the health authority.
“That’s just a picture of how ridiculous this whole thing is,” said McNicoll. “It really destroyed trust from the industry’s side. It shut businesses down with absolutely no warning. We’re lucky that it only lasted a couple weeks; it was definitely the biggest bump in the road.”
Echo Electuary’s concentrate-based edibles are back on the market for the first time in a month, and Mills anticipates OHA to authorize Echo Electuary’s extraction process later this week. The constantly changing industry has forced her business to be versatile, she said.
“Completely having to halt overnight because of a statement from an involved agency is proof that anything goes from the state’s perspective,” she said.
While edibles were originally slated to be introduced on the recreational market on Oct. 1 this year, Senate Bill 1511, signed by Gov. Brown on March 3, will allow dispensaries to sell “single-serving, low-dose” edibles, topicals and extracts earlier than Oct. 1. The exact date when these sales begin hinges on the health authority’s decision, and the OHA has had to create and implement some rules before this takes place.
Business owners are looking toward the OHA to raise the window on recreational sales for edibles for Oregonians 21 and older. When this is finally allowed, the limit is one edible per customer per day.
Oregon Medical Marijuana Program did not respond to the Emerald in time for publication.
The potency limit for recreational edibles is still capped at 5 milligrams of THC per serving and 50 milligrams per package.
This has since spurred McNicoll’s Oregon Responsible Edibles Council — a trade association of small, independently owned Oregon edible businesses including Echo Electuary — to launch a “Try Five” campaign, which recommends first-time users to eat one serving and avoid overindulging. “Try Five” posters will be displayed in windows of dispensaries in the Eugene area before the recreational edible sales begin.
Previously, Oregonian edible producers were barred from making recreational and medical edibles in the same kitchen; however, this complicated separation was also reevaluated in House Bill 1511. Now, any business can make both kinds of edibles in any kitchen licensed by the Oregon Liquor Control Commission.
OLCC-licensed dispensaries, which will open on Oct. 1, will vend both recreational and medical edibles.
Marijuana analysis laboratories like Oregon Grower’s Analytical — which test products for mildew, mold, pesticides, and potency before they’re sent to dispensaries — are also undergoing a rigorous accreditation process before Oct. 1.
“We’re seeing a general slowdown as everybody’s scrambling to get everything in place,” said Rodger Voelker, OG Analytical lab director. “We fought hard to bring standards and now we have to put money where our mouth is. The realities of making all this work is pretty tough.”
Many companies that are working with the lab for accreditation are based out of state or even overseas; since it’s still against federal law to ship cannabis across state lines, quality-assurance companies are sending hops to Voelker’s OG Analytical to ensure that his lab meets precise criteria, as both offer similar challenges in analysis.
“We’re just trying to make this akin to other commodities in all other testing and legitimizing it — whether it’s fruit, vegetables, drinking water, there are checks in place. It’s a very prescribed system. There are technical challenges here that don’t apply to other commodities,” he said.
The process of analyzing an edible — be it a honey stick, cupcake, root beer or cookie — still poses a problem for Voelker, as no universal analysis procedure exists yet for these labs.
“Nobody’s even started to produce a proficiency test for cannabis-infused products. It’s just too complicated,” he said. “We don’t normally do that with a commodity – put a psychoactive inside a cookie. You don’t mix pharmaceuticals and food in that regard. There’s no precedent for that.”
Voelker said he’s witnessed a shift in the clientele that approach the lab. While it used to be mom-and-pop stores that bring in homemade edibles for analysis, bigger companies are stepping in that have different, more complicated recipes made with stabilizing agents that can prevent an edible from degrading while it sits on the shelf.
“What we’re seeing here are companies from the food industry with real know-how getting involved,” he said. “We’re seeing capitalism at play. We’re seeing big companies with a lot of money come in.”
McNicoll added, “People forget all the time that the game hasn’t even started yet. We haven’t even begun.”
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