DOH - Webinar - Medical Cannabis Workshop
(October 17, 2024) - Summary

A long running rulemaking project got fresh feedback on a draft from those in the medical cannabis sector, but staff were no closer to being able to forecast completion of their work.

Here are some observations from the Thursday October 17th Washington State Department of Health (DOH) medical cannabis workshop webinar.

My top 4 takeaways:

• The webinar workshop was a part of the Washington State Department of Health (DOH) medical cannabis rulemaking project.
  • The rulemaking project was opened almost two years earlier in November 2022, with the first workshop held nearly a year later in August 2023. The most recent workshop related to the effort was hosted on July 18th.
    • The primary areas of cannabis regulation for DOH had been the patient registry database, medical product standards for testing and labeling, and oversight of medical consultant training and certification.
  • Medical Cannabis Program Manager Loralei Walker noted that “really complex rulemakings like this can take that long,” and DOH officials remained interested in collecting input on proposed changes to the medical cannabis regulations (audio - 2m).
  • Walker introduced a reorganization of the draft language for WAC 246-70-060 relating to medical cannabis product labeling (audio - 2m).
    • The changes consolidated the content into three subsections for easier reading: “Logo Requirements,” “Label Requirements,” and “Label Restrictions.”
    • DOH Chemist Tholo “TJ” Johnson indicated that he was also a cannabis consumer who had noticed “quite a bit of extra real estate” on product labels, “whether it's a pre roll…flower or vape cartridges, edibles.” He argued the additional space could be used to provide consumers more product information.
  • Walker subsequently introduced proposed changes for WAC 246-70-090 on medically compliant product logos (audio - 2m).
    • Walker noted that the logos in the document were merely “ideas” and that the final versions would “have the same kind of design as what we have already.” She explained that one of the proposed logo changes was to add another circle around the statement “This product has not been approved by the FDA [US Food and Drug Administration] to treat, cure, or prevent any disease.”
  • Walker outlined the draft language for WAC 246-70-100, a new rule section related to a patient tax exemption.
    • After explaining how the draft language clarified that the Washington State sales and use tax didn’t apply to medical cannabis products purchased by authorized patients from endorsed retailers, Walker acknowledged that the language addressing the excise tax exemption might need to be revised or removed from the DOH rule based on Washington State Liquor and Cannabis Board (WSLCB) staff concerns.
    • The exemption to the excise tax was approved in HB 1453 and had been set to expire in 2029. Learn more from a WSLCB presentation on implementation of the law from September 17th.
  • Walker introduced the draft language for WAC 246-70-040 involving medically compliant products, a second pass at the product classifications. She then opened the floor for feedback regarding the use of the term “medical grade” in the product classification scheme (audio - 2m).

• Participant feedback highlighted the views of a cannabis patient, two medical consultants, and several representatives and licensees from the cannabis industry.
  • Caitlein Ryan, The Cannabis Alliance Executive Director, argued that the proposed product categories and logos should be revised to improve patient understanding of the DOH medical cannabis rules (audio - 3m)
    • Ryan stated that the impetus behind the rulemaking was a petition from patients who found the term “DOH compliant” confusing. “The petition for this rule set was specifically to address this particular issue,” after many patients told her “it was unclear…what that meant.”
    • Ryan argued that the current product categories—general use, high THC, and high CBD—were similarly difficult for patients to understand. She supported official plans to revisit the product categories and for changing the term “DOH compliant,” a potential improvement that be “really helpful for the people that this product is intended for.”
      • However, she warned proposed terminology like “DOH Quality Assured” might lead patients to infer the department had “done third party testing or third party sampling” of labeled products.
  • Chuck Olivier, a medical cannabis consultant and Dimebag Scale Company Owner, argued that the proposed QR code could provide patients with better access to information, and he advised that licensed producer/processors host their products’ certificates of analysis (COAs) on their websites (audio - 2m).
    • “I think…having a QR code to the COA is a great idea,” said Olivier, though he warned that there were questions about the permanence of QR codes and whether the links associated with them would be checked regularly.
    • Olivier noted that others in the webinar chat had supported the idea of the licensees which produced or processed cannabis hosting their corresponding COAs, a practice he believed “might do better for consumers and patients when they actually go back to check that COA days or weeks after they purchased the product.”
  • John Kingsbury, Cannabis Alliance Patient Caucus Chair, advocated for patient access to information and questioned the motivations of producer/processors hesitant to implement changes to the medical cannabis rules.
    • Kingsbury voiced concern that allowing retailers to apply medical cannabis stickers to products could create opportunities for fraud, observing he’d personally “found a couple of instances where the COAs [he] was given did not match the product that had the stickers on them” (audio - 1m, audio - 3m).
    • Kingsbury suggested that the DOH rules “pull out that pesticides requirement in lieu of that QR code” as a way to free up space on product labels for other information (audio - 4m, audio - 1m, audio - 1m, audio - 1m, audio - <1m).
      • Kingsbury stated that “as a consumer myself, [his] only concern” was knowing what pesticides might be present in a given product.
    • Kingsbury said, “the point of the labeling period, the top point is to…help the consumer.” While supportive of the proposed QR code requirement, he registered his “absolute opposition” to having them link to a webpage where consumers would then have to sort through multiple lab results (audio - 3m).
      • He pushed back against concerns expressed by producer/processors that proposed changes would increase their costs by pointing out that participation in medical cannabis product manufacturing was voluntary. Kingsbury argued “this is not just an opportunity…to put a stamp on your Taco Bell weed and sell it at an excise tax discount.”
    • Kingsbury also asserted “high THC” was an inaccurate term for one of the product classifications and that the logo for this classification “needs to indicate that [it] is…serving size.”
      • Besides the DOH definition for ‘high THC’---which they count as “more than 10 mg but not more than 50 mg of active THC per serving or application”---other conflicting uses of the term exist.
      • Officials from the Washington State Health Care Authority (WA HCA) assert “policymakers looking at ways to reduce harms from these products focus on those that contain 35% THC or more.”
      • By comparison, the Washington State Department of Agriculture (WSDA) distinguishes “high THC cannabis” by the THC limit for hemp, covering any cannabis over “0.3% or less by dry weight.”
  • Micah Sherman, Raven Co-Owner and Washington Sun and Craft Growers Association (WSCA) Board Member, favored a technology-based solution to provide patients with detailed product information.
    • Sherman clarified whether the intention of the proposed language for WAC 246-70-060(1)(d) was to prohibit retailers from applying medical cannabis logos to product packaging (audio - 3m).
    • Sherman expressed a desire to discuss the term “medical grade,” and stated he did not “like the implications of that term.“ He suggested there wasn’t scientific basis for the claim that “additional testing infers qualitatively better results” (audio - 1m).
      • Moreover, he did not “agree or appreciate the implication that [medical cannabis] implies that it is at a different grade than it not being tested.”
      • He advocated for “additionally tested cannabis” as wording which might be a more appropriate term instead of “medical grade cannabis” (audio - 5m).
    • Sherman acknowledged that “there's just not enough space to do all of those things” when it came to fitting all of the proposed label requirements on product packaging.
    • He called on DOH staff to create an API to collect product information already being shared among licensees (audio - 2m, audio - 1m).
      • Sherman described the Washington Cannabis Integrators Alliance (WCIA) “open source JSON format to communicate all of the data that’s in all of these tests” which already existed “independently” of the WSLCB Cannabis Central Reporting System (CCRS).
        • Agency leaders had begun looking for a replacement for CCRS, last discussing the effort with legislators on September 17th.
  • Matthew Friedlander, Skagit Organics Founder and Chief Operating Officer, acknowledged his company processed compliant cannabis products and raised concerns about the proposed labeling and logo changes. He made recommendations for how to implement them in a way he argued was more feasible for businesses.
    • Friedlander asked if it was permissible to use medical cannabis logos in advertisements for medical cannabis products. Deputy Director of Drug Systems Shannon Angell suggested advertisement regulation was the domain of WSLCB officials rather than DOH (audio - 1m).
      • Friedlander confirmed that the proposed language for WAC 246-70-060(1)(d) “doesn’t expressly prohibit us from doing that.”
    • Friedlander was in favor of having QR codes on product labels, as “that makes a lot of sense for the consumer.” He was curious about allowing a QR code to link to a webpage that had tested results for multiple products, ”as opposed to…one QR code for that specific product?” (audio - 2m)
      • Friedlander further argued applying a QR code on a COA from Confidence Analytics could be scanned, “so…if any producer/processors had altered the test result…that QR code…would…show the actual” lab analysis.
      • Friedlander supported having DOH rules add the FDA disclaimer to the “General Use” medical cannabis logo.
  • Juddy Rosellison, Co-Owner of Trail Blazin’, agreed that QR codes on product labels could provide patients with more information and recommended that the DOH collaborate with the WSLCB to determine how much information could be included on the COA in order to maximize label space.
    • Rosellison asked about a list of allowable pesticides for use on medical cannabis (audio - 1m).
    • Rosellison stated that the DOH should take into consideration the fact that “there is a difference between a package and a label” when evaluating the feasibility of adding more labeling requirements (audio - 1m).
      • Responding to staff comments on the availability of “real estate” on packages and labels for new information, he noted labels were “usually printed” in bulk for individual products.
      • “A lot of the industry uses Zebra Printers with fixed size labels…so to say that there's plenty of real estate” was “not likely.”
    • Arguing the cannabis industry had “become numb to the fact that [consumers and patients] really can’t access this information” because of the difficulties involved in obtaining COAs from retailers, Rosellison supported “some sort of system to get the information to the consumer a lot more easily than it has been” (audio - 2m).
      • “I’m also in support of trying to put on the table how much information can we put in said QR code to free up more space,” stated Rosellison. He hoped that the DOH and LCB would work together in determining ways to maximize space on labels.
  • Rob McKinley, Phat Panda CEO, was troubled about the feasibility and cost of the proposed changes for producer/processors. He disagreed with Kingsbury’s assessment that retailer mislabeling was a significant concern, arguing that his personal experience was “probably a budtender error.”
    • McKinley stated, “from a big processor like us, we may have three different batches of the same flower going to a store at one time, and so…there may be three different COAs…they could pull the wrong COA and do it” (audio - 1m).
    • McKinley explained how his company had modified the medical cannabis logo, stating that they “added another circle around it with the FDA part of it.” He then asked, “Would that be considered altered?” (audio - 4m).
      • Walker couldn’t give him a “definitive answer.”
      • McKinley argued that changing the medical cannabis logos would create a significant cost for licensees: “if you switch it again, then the monetary cost associated to that would be ridiculous” for processors which had printed legacy labels in bulk.
    • McKinley was of the mind that “there’s just not enough space” on product labels to accommodate the proposed labeling requirements (audio - 3m).
      • He stated, “we have 1400 SKUs [stock keeping units], and I maybe have…20 different edibles that have enough room where I can put a bigger sticker on the back of them that could hold all of the things that you’re requesting.”
    • McKinley stated that his company decided to make all of its products compliant with DOH medical cannabis rules, but this had cost implications, “to continue to add other things that we already have to do while we’re already sticking a million units a month…to then take up real estate on the labels…it’s almost impossible to fit it all” (audio - 1m).
      • In her opening remarks, Walker noted that there were calls for “having a time period for that transition” so that businesses were permitted to “phase out old logos over time.” McKinley stressed that labeling took time to implement for producer/processors and they needed a grace period for proposed changes.
      • WSLCB leaders previously allowed for a sell down period in the Quality Control Testing and Product Requirements rulemaking completed in March 2022, though the sell down period for cannabis which hadn’t been tested for pesticides was set out in a separate since-rescinded policy statement.
    • McKinley liked the idea of using QR codes to meet patient information needs but had concerns about the logistical challenges involved. He claimed, “there are a lot of producer/processors that aren’t going to have a lot of technical expertise on how to attach a QR code to a label that’s going to go to a bunch of tests, especially…then to host that information…forever. That might be a logistical nightmare for smaller…companies as well” (audio - 3m, audio -1m).
  • Brooke Davies, Washington CannaBusiness Association (WACA) Deputy Director, offered concerns the proposed requirements could result in overcrowded labels and that licensees would need time to implement DOH medical cannabis rule changes.
    • Davies stated that there were “over 100,000 different SKUs on…the market” and that it was “really difficult to judge” the feasibility of the proposed labeling requirements based on “just one person’s experience” (audio - 2m).
      • Urging DOH representatives to “make sure that that feedback is heard” from producer/processors regarding the limited space on product labels for the proposed rules, Davies advised having a QR code “go to a webpage that has a bunch of different lists” if linking to a single product’s COA was not feasible.
    • Davies reiterated that licensees would need a reasonable transition period to implement any logo changes adopted by the DOH: “I know that you have heard this already, but…allow for sell through of current packaging before there’s any requirement to switch over to new” labeling (audio - 1m).
  • Bethany Rondeaux, Falcanna Owner, was among those supporting a QR code system that allowed for easy access to product information without imposing undue financial strain on processors. She also stressed the importance of considering the financial burdens placed on licensees choosing to participate in the medical cannabis program by the proposed changes.
    • Rondeaux recommended a searchable database of COAs that patients could access using the product’s THCA number (audio - 2m, audio - 1m).
      • Rondeaux stated, “[I]f someone can take the, the THCA number and type it into a search bar, and then that COA will pop up. That is a lot less labor intensive for all of us than making it where we have to be constantly updating…the QR code.”
    • Rondeaux stated that producer/processors need “grace and time to implement” the proposed changes (audio - 1m).
      • She reinforced, “[A]t the end of the day, we still need space for branding, and that needs to be taken into consideration.”
    • Supportive of the need for patient access to information, Rondeaux still argued that licensed business financial considerations were paramount: “it’s just important to consider that a lot of producer/processors are really struggling financially” (audio - 3m).

• Loralei Walker, DOH Medical Cannabis Program Manager, summarized the newly drafted language in WAC 246-70-100, which codified existing tax exemption rules and attempted to clarify how those rules applied to different medical cannabis products (audio - 6m).
  • Find out more about DOH interpretation of HB 1453 from a frequently asked questions (FAQ) document published in July 2024.
  • Walker explained that the first subsection of WAC 246-70-100 codified a 2022 DOH policy statement that exempted all medical cannabis products purchased by authorized patients and designated providers from sales and use taxes.
    • She mentioned that DOH staff determined that exempting all products from sales and use tax was necessary because the relevant RCWs used the phrase “DOH compliant products as defined by DOH,” and did not specify which products should be exempt.
  • Turning to the the second subsection of WAC 246-70-100, Walker stated it sought to clarify that high-cannabidiol (CBD) products could be purchased by any person and were not subject to sales and use taxes, regardless of whether the purchaser was a medical cannabis patient or designated provider.
  • Walker relayed that the DOH had initially intended for the third subsection of WAC 246-70-100 to clarify that medical cannabis products sold by endorsed retailers to registered patients were exempt from excise taxes.
    • “This was an attempt in our rule set to have all three of those [tax exemptions] together outlined,” said Walker, however “we did have conversations with LCB just after…this draft was finalized, and [their staff] expressed some concerns.” She invited Daniel Jacobs, WSLCB Policy and Rules Coordinator, to elaborate.
  • Jacobs shared WSLCB concerns about the DOH decision to include language addressing excise tax exemptions in WAC 246-70-100 and recommended that any such language reference the enacted excise tax rule, WAC 314-55-090 (audio - 2m).
    • Jacobs indicated agency leaders were concerned due to the fact that they had been given rulemaking authority for all excise tax exemptions: “[T]his excise tax exemption is something that’s…LCB’s to to manage…this excise tax gets paid by the retailers directly to LCB and so…additionally, because we just went through it, an extensive rulemaking process, I wouldn’t want any sort of slight variation in language between a statement of the rule in DOH’s rule and language about the rules in our rules to potentially create confusion for folks.”
    • He recommended that DOH rules should reference the WSLCB ruleset.
    • Walker thanked Jacobs for clarifying the issue and remarked that DOH officials would be willing to collaborate with WSLCB counterparts to ensure that WAC 246-70-100 was consistent with WAC 314-55-090.

• In response to a question from Bethany Rondeaux, a cannabis processor, DOH staff were unable to provide a clear timeline for completion of the rulemaking process.
  • Rondeaux asked DOH staff about the anticipated “general timeline” for completion of the rulemaking process (audio - 2m).
    • Walker responded that the rulemaking process could take a long time owing to the importance of thoroughly evaluating potential impacts of proposed rules, and to ensure all interested parties had an opportunity to provide feedback. “I…had a thought in my head, but the discussions we're having here” made her certain their rule language would again “go back to the drawing board and…look at timelines again.”
    • Angell spoke up to state “the other issue that we're running into with this rule set is that it hasn't been updated since it was initiated back in 2016 and one of the things that our program is really striving to do is to make this rule set make sense.” She expected this to be “one of the last rulemaking workshops that we're looking at doing, except for now that we've gotten some additional feedback, we might look at additional steps for the next one, if there will be one, but it's hard to give an exact timeline…because we just want to make sure that it's it's being done right.”
  • At the conclusion of the meeting, both Walker and Angell thanked the attendees for their participation in the rulemaking process (audio - 2m).
    • Walker called it a “really great” conversation, stating staff “put these ideas out there knowing there could be heated discussions or reactions, but we do it so that we can have good conversations like this.”
    • Angell added “a big thank you for all this feedback. We were able to record the session, and the chat has been super helpful.”

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