As more states legalize marijuana for medicinal and recreational purposes, safety of the product will become more of a concern. States like Michigan are tackling the issue of safety head on by requiring cannabis products be tested by a licensed cannabis testing facility before hitting the open market. The use of a licensed cannabis testing facility is a move to protect consumers from potentially harmful products that could have impurities or concentration levels that are too high, or even too low. This requirement of using a cannabis testing facility creates a level of accountability for cannabis businesses in the medical marijuana industry in the state of Michigan.
The state of Michigan is facing a dilemma with their medical marijuana requirements because the cannabis testing facilities available to test cannabis products have not obtained licenses. With no licensed cannabis testing facilities available in the state, other businesses that will transport and provide cannabis to patients are unable to legally operate. Michigan’s system for legalized medical marijuana relies on the ability to have all products tested at a licensed cannabis testing facility, and if products have not been tested, they cannot be distributed.
However, a key step in the state’s new system — a safety compliance facility where medicinal marijuana would be tested — has not yet been licensed in Michigan.
“Since none of those have been licensed yet, there can’t be a complete system yet,” Harns said.
That means none of the newly licensed operators can legally provide medicine to patients under the new system.
Operators approved for new licenses can wait to pay the $48,000 fee that would make their new license active, and can continue to operate under the second set of emergency rules the state put in place in May, Harns said. However, once an operator pays the $48,000 fee to make the license active, they’ll have to comply by the new medical marijuana rules, Harns said. That means they can’t distribute product to medical patients until their products have been sent to a licensed testing lab to ensure safety of the product.
Cannabis testing facilities in the state of Michigan carry a great deal of responsibility for the entire medical marijuana industry in that particular state. As a business owner of a cannabis testing facility that is relied upon to supply a form of medicine to patients, it is critical that a risk management plan is set in place. Cannabis testing is complex and presents the possibility for errors. Errors in testing can lead to a halt in operations, recalls, and law suits. If a cannabis testing facility makes a mistake it can cost the owner of that facility large sums of money to resolve.
Business owners should look to mitigate risk by working with a knowledgeable insurance company that can help guide them through the process of choosing the best insurance policy. A good insurance policy can help protect a cannabis business owner from financial losses due to errors, mistakes and issues in compliance. Without a well thought out risk management plan marijuana business owners could be facing financial losses which include fines from the state, revenue loss due to work stoppage and possible legal fees. It is also important to remember that regardless of what type of cannabis insurance policy you have, coverage limits will apply. You must read your policy with both your agent and your attorney to determine what your coverage consists of.