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Product Recall Plans for California Cannabis Manufacturers

by | Jan 22, 2018 | IP points, Cannabis | 0 comments

Cannabis products are certainly not immune from a recall, as we have already seen in Colorado, Oregon, and Washington. In most industries, state and/or federal law dictate product recall protocol. Since cannabis remains federally unlawful, neither the Food and Drug Administration or other federal agency has regulations specifically concerning cannabis recalls. For California manufacturers, the California Department of Health’s (DPH) emergency regulations (see Section 40268) provides general parameters for cannabis recall policies.

Various circumstances may trigger a cannabis product recall, such as detection of unlawful levels of pesticides, mold, or rot, reports of illness, mislabeled or improperly packaged products, or the product itself being unsafe (e.g., exploding vape battery).

How a business conducts itself during a recall can either convey a high level of professionalism or expose inexperienced operational capability.

Without a well-thought out and comprehensive product recall plan to help guide a company’s actions, recalls can be unnecessarily stressful and chaotic. If tragedy strikes, businesses must be able to act quickly, efficiently, and confidently to prevent or mitigate personal injury, as well as to limit damage to the brand’s goodwill and bottom line.

As a condition of licensure, most states with commercial cannabis regimes require licensees to establish a product recall plan, but few states actually provide substantive guidance on what a recall plan should entail. California requires that manufacturers of cannabis products establish and implement written recall procedures for products determined to be misbranded or adulterated.

At minimum, the DPH specifies such written recall procedures must:

  • Identify factors that may necessitate a recall
  • Designate personnel responsible for implementing the recall procedure and notifying the required state authorities
  • Outline protocols to notify all affected third parties such as suppliers, distributors, retailers, and consumers
  • Create mechanisms for reacquiring and quarantining recalled products
  • Detail procedures for the destruction of recalled products

The above requirements provide a minimum framework, and each element must be tailored to fit a particular company’s business operations and structure. The primary purpose of having product recall plan is to avoid scrambling while under pressure, to figure out what to do and who is responsible to do what. A thorough, clear recall plan with pre-drafted template communications should allow a company to shift into recall “autopilot” and avoid making costly mistakes.

Cannabis distributors and retailers are also affected by product recalls and should similarly plan for the possibility of a recall and establish a formal recall procedure. It is essential that distributors and retailers have a prescribed mechanism for recording consumer complaints and relaying such concerns to the manufacturer. Moreover, when informed of a manufacturer’s recall, a retailer or distributor does not want to be scrambling to figure out its obligations, and will want to have predetermined procedures for quarantining affected products and notifying all potentially affected customers.

Cannabis product recalls in California are likely to increase, as operators must now adhere to the standards proscribed by MAUCRSA and the emergency regulations. Achieving total product perfection in any industry is not easy or cheap, and the costs necessarily increase when the applicable rules are still evolving. Having a reliable product recall plan is instrumental to minimize any commercial and public relations fallout.

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