OLCC Commission Modifies Cannabis License Violations

Changes reflect industry maturation, OLCC regulatory evolution

Commissioners get glimpse of cannabis equity legislation impact on agency

OREGON:  The Oregon Liquor Control Commission has taken additional action to ensure that recreational marijuana license violations better reflect the current cannabis regulatory environment compared to regulations put in place five years ago when the cannabis industry launched in Oregon. At its regular monthly meeting on April 8, 2021, the Commission also formally approved streamlining changes to processing marijuana licenses, an approach OLCC staff have already begun implementing.

In addition OLCC Commissioners learned about likely impacts affecting the agency if cannabis social equity legislation is approved by the Oregon legislature and signed into law by Governor Brown. Commissioners also approved three stipulated settlements for recreational marijuana license violations.

OLCC regulations approved in 2016, at the onset of adult-use cannabis in Oregon, aligned with guidance in the since rescinded U.S. Department of Justice Cole Memorandum, and served as appropriate guard rails for an emerging industry. The changes just approved by the Commission better reflect the regulatory oversight needed for a maturing industry.

Some of the changes assign a different category to a violation if the violation was unintentional instead of intentional. For instance, now if a surveillance camera fails licensees have more time to inform the OLCC about the problem. Another change eliminates the compounding effect of a single violation when a producer fails to notify the OLCC of a marijuana harvest; previously the OLCC assessed a separate violation each additional day the producer failed to tell regulators.

The Commission also ratified changes in the marijuana license application process designed to speed up approvals. Those changes include boosting the ownership threshold for an applicant from 10 to 20 percent, allowing more flexibility for approving business structure changes, and eliminating the pre-licensing inspection requirement prior to issuing a license.

Oregon House Bill 3112 redresses criminal and economic consequences suffered by Black, LatinX and Indigenous Oregonians related to cannabis criminalization. A member of the coalition supporting The Oregon Cannabis Equity Act outlined for Commissioners how the measure would create economic opportunity for previously disenfranchised populations by reducing regulatory costs, and establishing an equity license for individuals who have previous marijuana criminal convictions, or are from Black, LatinX or Indigenous groups.

HB 3112 would create two other license types: a delivery license and a social (on-premises) consumption license. The delivery license would allow deliveries outside the city or county of a delivery business’ location, and it would also allow delivery to a hotel, both activities that are currently prohibited.

Commissioners also ratified the following violation fines and suspensions based on stipulated settlements (detailed information on specific cases can be found here on the OLCC website):

NEBULA CANNABIS in Portland will pay a $1,155 fine OR serve a seven day recreational marijuana retailer license suspension for one violation.

Licensee is: Haramkhor, LLC; Krishna Kumar, Member.

ALTERNATIVE SOLUTIONS in Portland will pay a $5,280 fine OR serve a 32-day recreational marijuana retailer license suspension for two violations.

Licensees are: Alternative Solutions 1, Inc.; Donald VanWormer, President/Director/Stockholder; Brenda Lingle, Secretary/Director.

GRIZZILLA FARMS will surrender its marijuana producer license on the date the transfer of ownership of the business is completed or on July 30, 2021, whichever is earlier.

Licensees are: Grizzilla Farms, LLC; Mark Aguilar, Manager/Member.

Commission Starts Effort to Limit Unchecked Use of Delta-8-THC, Other Artificially-Derived Cannabinoids

Concern grows about easy access to intoxicants at neighborhood convenience stores

OREGON:  The Oregon Liquor Control Commission has initiated rule making for Delta-8-THC and other psychoactive components of hemp and marijuana that currently fall outside the adult-use cannabis market’s system of testing and labeling. At their regular monthly meeting on March 18, 2021, Commissioners expressed concern about the general availability of this unregulated intoxicating product. The Commission also approved three stipulated settlements for violations committed by OLCC recreational marijuana licensees.

Delta-8-THC has recently emerged for sale nationwide, including in the supply chain of the OLCC recreational marijuana market, as well as in unregulated brick and mortar convenience stores and internet websites. Delta-8-THC is present in marijuana, but the OLCC only regulates Delta-9-THC produced in marijuana. When consumed by humans Delta-8-THC produces an effect (“high”) similar to Delta-9-THC.

Delta-8-THC can also be created from hemp, which is regulated under the federal Farm Bill of 2018. Typically, hemp-derived Delta-8-THC is converted from CBD through a chemical process, which also produces a large proportion – as high as 30 – 50% – of unknown byproducts. Delta-8-THC created from hemp can be found in food products and sprayed on hemp flower.

Delta-8-THC isn’t addressed in Oregon statutes, isn’t included in Oregon Health Authority marijuana concentration limits, and there’s no testing for the Delta-8-THC or the by-products included in its chemical conversion. But Delta-8 products are currently widely available for purchase outside the OLCC adult-use market, even by children.

“When this was brought to my attention alarm bells went off in my head,” said Paul Rosenbaum, OLCC Commission Chair. “You have minors going into grocery stores and they understand very well what this is all about. And let me tell you, if there’s a way to find it, people will do it.”

OLCC’s proposed rule-making would only address the presence of Delta-8-THC and other artificially-derived cannabinoids in products grown, manufactured and sold in Oregon’s recreational marijuana market. But for OLCC and the Oregon Department of Agriculture to take effective action on total THC measurement and tamp down the availability of such products to minors, legislative action is required.

“We don’t have sufficient authority over total THC in Oregon,” said Steve Marks, OLCC Executive Director. “But until we get that and ability to do final product testing to help get these things into the right markets where they’re supposed to be, either in the unregulated hemp CBD market or into our market it’s going to be hard.”

Marks observed that all states are facing the issue of how to regulate Delta-8-THC, but that Oregon is at the forefront in addressing it. Regulatory gaps do remain surrounding the broader issue of intoxicating hemp cannabinoid products in the general marketplace that can be legally sold to minors, and who should be responsible for regulating those products.

“Unregulated hemp has no final product testing,” said Marks. “They only test for Delta-9 in the field. You can’t regulate what you don’t test for. We’re talking about two species of the same plant. And that means that federal and state regulators need to harmonize their oversight of this plant, and work towards across-the-board testing of marijuana and hemp products designed for human consumption before they enter the marketplace.”

The House General Government Committee of the Oregon Legislature is expected to take up the Delta-8-THC issue at a public hearing on Thursday, March 25, where it could consider legislation ensuring that all intoxicating THC products, properly tested and labeled, are sold within the OLCC regulated system and also ban the sale of currently non-regulated Delta-8-THC products to minors under age 21.

The Commission also ratified the following violation fines and suspensions based on stipulated settlements (detailed information on specific cases can be found here on the OLCC website):

STONEY ONLY PORTLAND will surrender its recreational marijuana retailer licenseon the date the sale/transfer of the business is completed, or by 12:00 PM on June 16, 2021, whichever is earlier for two violations.

Licensee is: Stoney Only Portland, LLC; Joseph Babb, Member; Ragna TenEyck, Member; Michael Mullins, Member.

HERB N’ SPRAWL will pay a $4,950 fine and serve a two-day recreational marijuana producer license suspension OR serve a 32-day license suspension for one violation.

Licensees are: Prairie Song Organics, LLC; Yotokko Kilpatrick, Member; Rick Saga, Member.

DEEP ROOTS CANNABIS in Springfield will pay a fine of $3,465  OR serve a 21-day recreational marijuana wholesaler license suspension for one violation.

Licensees are: Premier Concepts, LLC; Mary Jane Wilson, Member; Susie Polen, Member; Braden Smith, Manager.

OLCC Notice of Public Hearing

Marijuana Licensing Streamlining

March 15, 2021 @ 1:00 pm

 

Presiding Officer:   Madeline Kane

Phone: 503-872-5081

Email: olcc.rulemaking@oregon.gov

 

To listen to or participate in this Public Hearing, please call: 1 (872) 240-
3311 and enter access code: 230-296-829#

Notice of Proposed Rule-making, including Statement of Need and Fiscal Impact

 

OREGON: OLCC has been inundated with applications for marijuana licenses. The growth of the industry and applicants willing to enter the market has overtaxed the agency’s resources for processing new applications and renewals of current licenses. This has created a queue that has impacted both new applicants and current licensees. For applicants, this has resulted in lengthier timeframes to be assigned which results in an increased financial burden to maintain property while waiting to operate a business. For current licensees, this impact delays their ability to adapt their business needs to industry change which results in a financial burden and in keeping pace with the burgeoning industry. Currently there are approximately 900 applications either being processed or waiting to be assigned.

 

The proposed changes address marijuana licensing process issues. This will provide relief for both licensees and OLCC resources so that OLCC will be able to integrate a more efficient process.

In order to offer oral comment, please email: OLCC.rulemaking@oregon.gov, no later than 12:00 pm on Monday, March 15, 2021. The hearing will end at 1:30 pm, if no interested parties have emailed to offer comment by 12:00 pm that morning; or 5 minutes after the last oral comment has been recorded into the record.

All written comments must be received by 5:00 p.m. on Monday, March 22, 2021.

 

Guidance For OLCC Marijuana Licensees Impacted By Natural Disasters (Power Outages & Ice)

OREGON: Natural disasters throughout Oregon can affect us in a moment’s notice. Business owners should be aware of potential disasters and plan ahead. If you have lost power due to the recent storms, this message is to provide guidance on how to record and notify the OLCC of your situation.

It is important to remember your safety and the safety of others is the first and foremost importance.

Notification Requirements: Recording Sales & Transfers

Notification: Once you are able to connect to the internet, email the OLCC at marijuana@oregon.gov with the following information:

  • License number, outage times, address of your licensed premises so we are aware of the situation, and can track the regional impact.
  • For camera outages, please complete this form.

Sales: please keep a detailed log of all sales/transfers as required by 845-025-7500 (8) Seed-To-Sale Tracking — CTS Requirements so that you can update your CTS account once you have regained power.

Transfers: If you transferred product (refrigerated items) to another licensee, do not request it to be transferred back until your buildings and cameras are operational, and your licensed premises can function according to OLCC rules.

  • For example, if you are a producer planning to transfer product to another licensee, make sure you know how your product will be separated from the other licensee(s) and the care it will receive. It also may be helpful to have any terms or agreements in place prior to the actual emergency evacuation.

OLCC Rules Advisory Committee Meeting February 12, 2021

Marijuana Violation Reclassification Rules Package

OREGON: This past fall the Commission initiated permanent rulemaking to revise the way compliance actions are administered. The proposed amendments in this package clarify and reclassify current violation categories. The Commission’s proposed rule language that will be discussed can be found here:

Due to the outbreak of COVID-19, we are holding Rules Advisory Committee meetings virtually. Please note that invited committee members and OLCC are the only persons allowed to participate in the discussion. Please be respectful and mute your phone.

To listen to the meeting, use the call-in information below:

Date and Time:       9:00 am – 12:00 pm, Friday, February 12, 2021

Location:                 Virtual

To listen to the meeting, dial: 1 (571) 317-3112; Access Code: 886-457-709

Oregon Cannabis Social Equity Bill Introduced

OREGON:  Repairing the harm from decades of inequity from the War on Drugs is the goal of the Cannabis Social Equity Act introduced this week by a coalition of legislators in the Oregon State Legislature. HB 3112 is the culmination of months of work led by former State Rep. Akasha Lawrence Spencer including numerous cannabis companies, the NuLeaf Project, the Oregon Cannabis Association, the Oregon Retailers of Cannabis Association, the City of Portland, Urban League, and law students from Willamette University.

“We came together with a common purpose – to undo and repair some of the harm caused by cannabis criminalization on Black, Indignenious and Latinx communities in Oregon,” said Rep. Lawrence Spence. “This legislation uses cannabis tax revenue to invest in Oregonians who have been unjustly targeted for decades by law enforcement, in an effort to repair some of the generational harm done to their communities.”

Chief sponsors of HB 3112 include Representatives Janelle Bynum, Ricki Ruiz, Mark Meek, Julie Fahey and Senators Lew Frederick and Kayse Jama. Current sponsors include Representatives Karin Power, Pam Marsh and Maxine Dexter.

Jeanette Ward Horton, executive director of NuLeaf Project, has been working with the coalition since its inception eight months ago. NuLeaf Project receives funding from City of Portland cannabis tax revenues and private donations to aid cannabis start up companies with funds, technical assistance and job placement/training.

“We’ve seen the harm to far too many families to not address this issue. Cannabis convictions bring challenges that ripple through families and cause hardship for the children of children whose parents were disproportionately arrested. The loss of jobs, education grants, housing and more that can all stem from a minor cannabis conviction have impacted communities of color for generations. Today Oregon has the chance to undo some of that harm,” said Ward-Horton.

The bill contains three major provisions:

  • Direct investment in cannabis businesses owned by Black, Indigenious, and Latina/o/x people, as well as people convicted of cannabis crimes. Creates investment in home and land ownership, job training, health care, education and other areas determined by the Cannabis Equity Board.
  • Free, automatic expungement of eligible cannabis criminal convictions paid for by cannabis tax revenues as needed. Previous legislation saw less than 200 of 28,000 eligible Oregonians successfully complete expungement.
  • Equity licenses for Black-, Indigenous-, and Latina/o/x  owned cannabis companies with reduced fees and modified requirements to initially qualify. Provides for funding of two OLCC positions to aid in the licensure process, and includes the addition of three license types beneficial for the small businesses owner.

Chief Sponsor and State Rep. Ricki Ruiz said fixing the expungement process is a critical piece of the legislation.

“Less than 200 out of 28,000 Oregonians eligible for expungement were able to successfully complete the process in the past two years. We need to do better,” said Ruiz. “This bill provides us the path and the funding we need to efficiently remove previous cannabis crimes from people’s records and provide them the opportunity to repair their lives from the harm caused by cannabis criminalization. It is a critical step toward restoring the health of these individuals and the communities where they reside.”

Gabe Parton Lee, General Counsel at Wyld, spearheaded the design of the automatic expungement process

“What we clearly see is that those left in the destructive wake of cannabis prohibition have been helped the least by cannabis legalization. Instead, we see a rapidly-growing industry that has largely left behind people and communities who disproportionately suffered under cannabis criminalization,” said Parton Lee, general counsel for Wyld. “We are advocating for the use of cannabis tax dollars to help correct some of these long standing issues of inequity and provide for direct investment into people and neighborhoods most impacted by cannabis prohibition.”

State Rep. Julie Fahey helped drive the creation of the bill when she passed legislation in 2019 calling for a work group to develop a cannabis social equity program.

“This effort has brought together a diverse group of advocates, business owners, and industry partners to develop one of the most comprehensive equity bills in the country – breaking down barriers for BIPOC Oregonians and investing in the communities most harmed by cannabis criminalization. The cannabis industry is a driver of economic opportunity for entrepreneurs in our state, and this bill will help ensure that those harmed by the war on drugs have access to those opportunities,” said Fahey.

A coalition of cannabis companies and trade groups including the Oregon Cannabis Association, the Oregon Industry Progress Association, and the Oregon Retailers of Cannabis Association have all united around this legislation as the key cannabis related bill for the 2021 session. Major sponsors include Groundworks industries, Wyld, Wana and Dutchie with dozens of other cannabis companies, law firms and others supporting the effort.

OLCC Rules Advisory Committee Meeting – February 3, 2021

Marijuana Licensing Streamlining

Rules Package

Oregon Liquor Control Commission News

This past fall the Commission implemented temporary rules to expedite and refine the recreational marijuana licensing process. The proposed amendments integrate a more efficient licensing process and reduce required documentation that must be submitted as part of a license application. Applicants will still be required to satisfy the same substantive requirements to receive a license. The Commission’s proposed rule language that will be discussed can be found here:

Due to the outbreak of COVID-19, we are holding Rules Advisory Committee meetings virtually. Please note that invited committee members and OLCC are the only persons allowed to participate in the discussion. Please be respectful and mute your phone.

 

To listen to the meeting, use the call-in information below;

 

Date and Time:       9:30am – 12:30pm, Wednesday, February 3, 2021

Location:                 Virtual

 

To listen to the meeting, dial: 1 (408) 650-3123; Access Code: 740-951-661

 

For more information, contact:

Madeline Kane

Phone: 503-872-5081

Email: olcc.rulemaking@oregon.gov

Oregon Liquor Control Commission Licensing Director Message: Marijuana Licensing Streamlining Update

January 8, 2021

A Phased Approach

Early in 2020 because interest to enter Oregon’s expanding recreational marijuana market continued to grow, it became clear that we needed a new approach for processing marijuana license applications. In response, my staff and I conducted a program evaluation in March 2020, to identify opportunities for improvement throughout the licensing program. Aside from the need for our staffing resources to grow to match the industry’s requirements (which we will continue to address with our legislative partners) we developed a formal year-long improvement strategy outlined below in three phases.

Phase 1: Streamlined license renewal process (Complete)

This included reducing the complexity of renewal applications, making licensing system updates and updating internal processes regarding renewals. Improvements to our renewal system went live August 4, 2020.

Outcome: Marijuana license renewals process times have been reduced from an average of 347 days from submission in Q4 2019, to 156 days from submission in Q4 2020. Current licensees should realize these improvements at their next renewal period occurring after August 4, 2020.

 

Phase 2: Removal of Pre-licensing Inspections and streamlining workflows (Complete)

In April 2020, the Commission eliminated the requirement to conduct pre-licensing onsite inspections before issuing a license, and during last summer we made improvements to licensing workflows by reducing redundant routine reviews of work and providing more empowerment to staff. Our evaluation showed this was taking as much as 40-50% of the processing time for new applications; these improvements removed that constraint.

Outcome: Marijuana license application process times from assignment have been reduced from an average of 168 days in Q4 2019 to the average of 61 days in Q4 2020.

 

Phase 3: Entrusting the Industry (Complete)

The overall philosophy of this change was rethinking how we address marijuana licensing. Specifically, phase 3 changes reduced the level of scrutiny for applicants who have already been vetted and previously licensed. Further, the agency reassigned personnel and added contract workers to solely focus on licensing activity. The Commission also approved “streamlining licensing,” rule changes at our October 15, 2020 Commission meeting.

Outcome: License application processing times approved during the month of December 2020, averaged 54 days from the date of assignment. These tangible changes have reduced the back and forth between applicants and the Commission.

 

The Readiness Checklist: Who’s ready? Who’s not?

In addition, we’ve implemented a new process to provide us more insight into applicants within our applicant pool by utilizing a request for assignment form (aka “The Readiness Checklist”). This process helps identify a marijuana license applicant’s desire to be assigned and enables them to self-determine their readiness to complete the license process within the required 60 day period.

As of November 16, 2020, my staff has reached out to all 881 “pre-pause” applicants, to determine their desire and readiness to be assigned. Pre-pause applicants include applications submitted prior to the June 15, 2018, pause on processing licenses. As of January 5, 2021, we have:

  • 319 or approximately 36% of the 881 applications are ready to be assigned
  • 360 or approximately 40% of applicants have said they are not ready
  • These applicants have delayed assignment by an average of 5 months.
  • 139 applicants not respond at all.
  • 49 application withdrawals.
  • The remaining 14 are in process.

As of January 6, 2021, we have assigned all applicants who’ve requested to be assigned as of that date. Additionally, as we receive requests for assignments, now we are consistently able to assign applications within two to four weeks of receiving the request for assignment form.

In addition to this progress on new marijuana license applications, we have been able to reduce the time it takes to assign change requests (e.g. location, ownership, etc.) from four to six months in Q3 2019, to approximately two months in Q3 2020. Moving forward, while we further refine our processes, our standard is to be able to assign these requests within 60 days of receiving them.

Regarding the non-responsive applicants, we’ve reached out to each one and subsequently followed up with those applicants prior to December 12, 2020 in order to provide a final opportunity for them to respond before inactivating their application.

Industry members and applicants should ensure they are monitoring any communications from the Commission and double check that the contact information affiliated with the license application is up to date.

 

The New Year: What’s next?

Earlier this year, OLCC Executive Director Steve Marks committed to reducing the backlog of license applications by one third by February 1, 2021; at the time he made that pledge that meant reducing our application pool by a total of 350 applications. The progress we have demonstrated leads me to believe we will meet, or come close to, accomplishing that goal. Should we not be able to, this will be in large part due to the number of applicants who’ve indicated they’re not ready to be assigned. As mentioned above, we are assigning applications within two to four weeks of receiving a request for assignment form. The average time to process a license application once it’s assigned was 61 days in Q4 2020; that’s a significant reduction and close to the new standard we’ve set.

With the changes we’ve made this year and at the current pace that we receive license applications, this should not be difficult to maintain going forward. These accomplishments truly deliver what the industry asked us to address, both in timeliness and predictability. We hope this serves as an example of how we will continue to work with the industry and to strive to improve and make Oregon a leader in the cannabis industry and a model for cannabis regulation.

As always, please don’t hesitate to reach out with feedback and guidance that will help us collectively make constructive improvements to the OLCC Recreational Marijuana Program.

Jason Hanson

OLCC Director of Licensing

Jason.hanson@oregon.gov

 

 

OLCC Recalls Contaminated Marijuana Products Sold Into Recreational Market

Product still in stores “locked” in Cannabis Tracking System to prevent new sales

OREGON:The Oregon Liquor Control Commission is issuing an immediate health and safety recall after identifying pesticide contaminated marijuana products sold through OLCC recreational marijuana licensed retailers. The OLCC has notified retailers to place a hold on all affected products.

The marijuana flower and extract products initially failed pesticide testing (for the analyte Abamectin) with a subcontracted laboratory, but the primary lab – Ecotest – marked that it passed testing in March 2020. The OLCC in September 2020 issued an immediate license suspension to Ecotest due to a number of violations, including the loss of accreditation from the Oregon Environmental Laboratory Accreditation Program (ORELAP) for failing to meet required testing procedures and standards (see OLCC press release). Later, the OLCC formally cancelled Ecotest’s license.

The contaminated marijuana originally entered the Oregon market from a medical grower transferring it into the OLCC regulated system. Oregon Medical Marijuana Program growers are allowed, with prior approval, to sell no more than 20 pounds of marijuana flower annually into the recreational system.

The contaminated product includes several strains of marijuana flower pre-rolls, and “Purple Slurry” extract. Due to the incorrect entry of results by Ecotest, when making the

Consumers can identify the affected products with the following information:

“Emerald Extracts Purple Slurry”

  • Manufactured by Emerald Treasure LLC (030-1008341A083)
  • Label Id = 2805
  • Made on 9/9/20
  • Tested by MW Labs (010-1008606C050) on 9/14/2020

Marijuana flower pre-rolls

  • Strains of “Qurkle,” “BP Oil Slick,” or “Green Crush”
  • Tested by Ecotest (010-1008170B3B6) on 3/12/2020
  • Sold from Bernie’s Universal Dispensaries in South Beach, OR

Consumers who have these recalled products should dispose of the products or return them to the retailer where they were purchased.

A table listing the retailers that sold the items and the approximate dates the products were sold is attached to the press release version of this communication, which can be found on the OLCC website.

The contamination issue was reported to OLCC on December 29, 2020 by a second processor whose extract product failed pesticide testing; their product was never sold to consumers. Using data from the Cannabis Tracking System, OLCC staff were able to verify the failed subcontracted test, trace the affected items in the system, and issue guidance to licensees to set aside the contaminated product.

Consumers who have these recalled products should dispose of the products or return them to the retailer where they were purchased.  Consumers can follow these instructions found on the OLCC Recreational Marijuana Program website to destroy marijuana on their own.

There have been no reports of illness. The possible health impact of consuming marijuana products with unapproved pesticide residues is unknown. Short and long-term health impacts may exist depending on the specific product, duration, frequency, level of exposure, and route of exposure. Consumers with concerns about their personal health should contact their physician with related questions. Consumers with questions or concerns about recalled product or pesticide residues in marijuana products are encouraged to contact the product retailer and/or the Oregon Poison Center at 800-222-1222.

OLCC Identifies Potential Consumer Harm In Some Cannabis Vape Products

Voluntary recall started because non-cannabis additives had undisclosed ingredients

Investigation continues to determine impact across Oregon’s legal cannabis industry

OREGON:  As part of an on-going consumer product safety investigation, the Oregon Liquor Control Commission has identified that marijuana products sold in Oregon’s recreational marijuana market during the last two years contained additives, squalene and squalane, that have been linked to safety concerns similar to Vitamin E Acetate when vaped and inhaled. The OLCC is working to trace products and when necessary remove them from sale. OLCC will be considering immediate action at its December 2020 Commission meeting to prohibit future use of squalene and squalane, institute a mandatory recall of affected products, and create a more stringent and transparent review process of cannabis vaping products going forward.

Recreational retail shops won’t be open until October.

The products under investigation by OLCC contained Viscosity, a non-cannabis diluent manufactured and sold by a third-party (non-OLCC marijuana licensee). Some of the product remains on the market, and the OLCC is working to trace and remove it.

Bulk Naturals LLC., dba True Terpenes, sold Viscosity that solely contained squalene, squalane, and an unidentified olive extract to OLCC recreational marijuana licensees between at least January 2018 and November 2019. Squalene is a “botanically-derived terpene” that can be derived from olives; squalane is the hydrogenated version of squalene. Following OLCC’s confirmation of the presence of squalane in Viscosity via independent laboratory analysis by ChemHistory and SC Labs, True Terpenes has complied with all of OLCC’s requests for information. Viscosity has since been reformulated, and according to True Terpenes, none of their products have contained squalene or squalane since November 2019.

As a result of its investigation the OLCC has identified recreational marijuana licensees that potentially used Viscosity in their products.  Because of their purchase of Viscosity, OLCC has requested additional information from several licensees about products they have manufactured.

One licensee – Oregrown, a vertically integrated cannabis company based in Bend – swiftly provided the requested documentation. Oregrown was the first licensee to confirm its use of the Viscosity formula under investigation, and since then has been working with the OLCC to voluntarily recall the limited amount of its remaining product containing Viscosity. OLCC has provided Oregrown with the information regarding affected items still on the market and their current location.

Oregrown utilized Viscosity in making Oregrown PAX Era D9 Elite style vaping products manufactured on or prior to August 31, 2019. Although Oregrown has reformulated its PAX product to no longer include Viscosity, the previously manufactured items containing the prior Viscosity formula remain in the market. The most recent sales from Oregrown PAX Era D9 Elite products containing this prior Viscosity formula were in October 2020.

In all, between April 2018 and October 2020, 268 OLCC licensed recreational marijuana retailers sold this item.

Consumers can verify the date of manufacture and whether an item they have purchased is subject to this recall. Any Oregrown PAX Era D9 Elite item with the label identification of “2520” and made before August 31, 2019 should be destroyed by the consumer or returned to the retailer where the item was purchased.

The OLCC has found that Oregrown was NOT aware of the contents of Viscosity and didn’t know that it contained potentially harmful ingredients. At the time that Oregrown used Viscosity, the manufacturer, True Terpenes, did not publicly disclose any of Viscosity’s ingredients due to claims of trade secret protections. Oregrown has provided all information that OLCC has requested, and its products complied with OLCC’s labeling rules at the time. OLCC expects that other licensees will act just as swiftly in order to ensure consumer safety by assisting the Commission in identifying and removing these potentially harmful products from the market.

The OLCC has been concerned about the presence of undisclosed ingredients in cannabis vaping products, and during the last year has been examining the use of non-cannabis additives. As part of this review OLCC has gathered evidence that certain additives pose potential danger to consumers.

At the same time the OLCC has suspected that these unhealthy additives had already been introduced into Oregon’s recreational marijuana system without the knowledge of licensees. The OLCC has been investigating the presence of unknown additives in cannabis vape products, which led to OLCC’s independent discovery of squalene and squalane tainted products.

OLCC recently commissioned a study that determined that when exposed to heat, squalene and squalane produce harmful chemicals. It has also been documented that inhaling squalene has been associated with exogenous lipoid pneumonia. Initial evidence about these additives also suggests a potential for consumer harm similar to that already proven about Vitamin E Acetate.

In light of these recent findings, OLCC staff will be proposing two actions at OLCC’s December 17, 2020, Commission meeting. One will be an action that would declare squalene and squalane adulterants; if approved by the Commission, any items in Oregon’s regulated market to which squalene or squalane have been added would be subject to a mandatory public health and safety recall. The second proposed action will be rules regarding cannabis vaping products that have been under development since July 2020; these rules would establish greater transparency and accountability regarding non-cannabis ingredients, like Viscosity, that are used in cannabis vaping products sold in the OLCC system.

OLCC is continuing its investigation into licensees that purchased Viscosity during the relevant time frame in order to confirm whether it was used in any other vaping products that were sold to consumers. If it is determined that other licensees used the prior formulation of Viscosity without proper disclosure on the item’s label, or have withheld information from the OLCC regarding the use of Viscosity, OLCC will pursue compliance action against those licensees as necessary. Additional health and safety recalls may be issued as more information is discovered.