For the past two decades, states across the country have begun pushing for the legalization of marijuana, hemp and other derivative products. This has helped create a whole new retail market that is currently in the earliest stages of its development, though a lack of federal support has caused major disagreements about how these substances should be distributed, regulated and taxed. Currently, marijuana is fully legalized in 11 states for both medical and recreational use, with Illinois joining the pack in late June, Business Insider reported. While each of these regions has its own governing legislation, there are some important areas of overlap that marijuana retailers should keep in mind.
Marijuana Packaging and Labeling Requirements
Although the sale of marijuana products is now permitted in select states, there is a range of strict packaging and labeling guidelines that retailers must adhere to. The purpose of these standards is to ensure businesses are selling their products responsibly and providing consumers with detailed information that can help guide their buying decisions. The only way to remain compliant with existing marijuana laws is to understand the state-specific regulations on the books, but learning more about general best practices is also important.
Under normal circumstances, the Food and Drug Administration would be responsible for establishing and enforcing labeling guidelines for new products. However, the FDA has not released any substantial guidance for how cannabis should be marketed, packaged or labeled. While the agency has been ramping up its research efforts, much of the FDA's focus has been on products intended for medical uses, such as cannabidiol (CBD). In the absence of national legislation and regulatory oversight, state governments have been left to hash out their own labeling and warning standards, though according to Leafly, many require the following information to be present:
- Content warnings: All cannabis labels must clearly and visibly state that marijuana is a core ingredient in the product. This ensures that consumers are able to identify the contents and make informed purchases.
- Potency: Since different strains of marijuana have higher or lower levels of THC (the primary psychoactive component of marijuana), businesses are required to list the estimated potency of their products on the packaging or labels.
- Age restrictions: Much like alcohol, the sale of recreational marijuana to individuals who are below the age of 21 is expressly prohibited. Cannabis retailers must include this statement to mitigate any potential liability issues, along with a warning to "keep out of reach of children and animals."
- Health risks: While there is no clear consensus about the side effects of cannabis use, retailers must include warnings that there "may be associated health risks" with using their products. Most states also require a disclaimer about using marijuana when pregnant or breastfeeding.
- Resale/transfer: In states where cannabis is only permitted for medical purposes, dispensaries are asked to include disclaimers about the illegality of possessing, consuming or transferring their products to any individual other than the prescribed patient.
- Ingredients: As alternative cannabis products grow in popularity, the need for accurate ingredient information becomes more apparent. Retailers are required to list all of the pharmacologically active ingredients used in their goods, including THC, THCA, CBD and any other cannabinoid content in milligrams per serving and servings per package.
- Retailer identification: Any business that sells cannabis products must list its name, address, contact information and license number on their labels and/or packaging.
- Product identification: To help government officials and agencies keep track of the sale, distribution and recall of marijuana-based goods, retailers must include a unique serial number on their products that correspond with the batch and lot numbers used by their cannabis growers. They are also required to list the name of the strain and the quantity in most states.
These are only a few of the labeling and packaging requirements dispensaries must adhere to, which is why it's crucial for businesses to stay up-to-date with new laws and regulations. However, since the cannabis market is in a state of rapid expansion, many retailers have found it difficult to remain compliant.
Massachusetts Dispensary Fined $75,000 for Improper Labeling
In early June, the Cannabis Control Commission in Massachusetts issued its first-ever fine for improperly labeling marijuana products to a small dispensary in Leicester, the Boston Globe reported. Cultivate Holdings, one of the original cannabis shops authorized to sell recreational marijuana in the state, has agreed to pay $75,000 to settle charges that it sold "hundreds of improperly labeled pot products to consumers." The accusation was based on the results of an unplanned inspection conducted by the commission back in January, which found that Cultivate had failed to update the labels of thousands of cannabis products that were entered into the state's inventory tracking system.
More specifically, the dispensary ran afoul of Massachusetts' requirement that all recreational marijuana products must include warnings about THC content. After looking into Cultivate's sales history, investigators found that more than 880 recreational cannabis products were distributed to customers without the appropriate information. This fine represents a possible pain point for dispensaries moving forward, as it's unclear how the state's guidelines will evolve over the next few years.