Cannabis News of Note for the Week:
Politico Pro Cannabis: Market Uncertainties Prompt Expansion Pullback (paywalled newsletter, full text below)
Politico Pro Cannabis: Transportation Department adopts oral fluid drug testing (paywalled, full text below)
Cannabis Reports of Note for the Week:
Politico Pro: MARKET UNCERTAINTIES PROMPT EXPANSION PULLBACK —
New York’s nascent cannabis market was initially attractive to Terrapin Care Station, a Colorado-based cannabis company with operations in Pennsylvania. After the state passed a legalization bill in 2021, Terrapin was eager to plant a flag in what’s expected to become one of the largest marijuana markets in the U.S.
But Terrapin’s planned production facility in Auburn, N.Y., has been scrapped due to “painful delays” in New York’s rollout of its recreational marijuana industry, the Auburn Citizen reports. More than two years after the state legalized marijuana, fewer than 10 dispensaries have managed to open their doors, and some of them only on a temporary basis.
“We were looking to grow [cannabis, and] there’s really nobody to be selling it [to],” Peter Marcus, communications director at Terrapin, said in an interview. But even considering the long-term potential of the New York market, the entire cannabis industry is struggling with broader macro-economic conditions.
“What we’re also seeing in other markets is that there’s never a focus on setting [social equity] businesses up for success,” Marcus said. “Capital is drying up in the cannabis industry as well. … There’s a myriad of factors as to why New York … is just a very uncertain road to take.”
Those issues are not limited to New York. Other cannabis markets have seen falling wholesale prices that have hurt longtime cannabis operators in mature markets. Terrapin also decided to pull out of expansion plans in Michigan and Missouri, but is still focused on Pennsylvania’s medical market.
In most markets, retail prices are falling as is foot traffic as an increasing number of states launch their own marijuana markets, Marcus explained. That’s causing a “race to the bottom” for cannabis companies focusing on pumping out cheap products.
What’s next: While the company is still moving forward with plans to open a dispensary in Hoboken, N.J., it’s not considering any additional expansion effort at this point given cannabis market uncertainties plus other economic factors like rising inflation and interest rates.
|Politico Pro Cannabis: Transportation Department adopts oral fluid drug testing|
|BY MONA ZHANG | 05/02/2023 04:45 PM EDT|
|The U.S. Department of Transportation adopted oral fluid drug testing in a final rule published Tuesday.
The move follows the Department of Health and Human Service’s final rule allowing federal workplace drug testing programs to incorporate oral fluid tests in 2020. Allowing oral fluid collection would help address potential cheating on urine tests.
The new rule affects several agencies within the DOT, including the Federal Aviation Administration, the Federal Motor Carrier Safety Administration and the Federal Railroad Administration.
The background: HHS started exploring drug-testing alternatives in 2004, due to the potential for cheating on urine tests. But at the time, the science around oral fluid testing was not advanced enough to assess the testing method.
The issue of cheating on urine tests was particularly acute for marijuana consumption, as THC can be detected in urine up to 30 days after consumption — far longer than other illicit substances.
The science since then has advanced enough that “HHS determined, in 2019, that the methodology is accurate and appropriate for Federal employee testing,” DOT’s final rule said.
HHS determined that the 4 nanogram per milliliter cutoff for THC would not result in any false positives resulting from exposure to second-hand marijuana smoke for oral fluid testing.
More details: Oral fluid testing is generally cheaper and less invasive than urine testing.
While many public commenters likened oral fluid testing for THC to marijuana impairment tests, DOT’s final rule emphasized that oral fluid tests are not meant to test for impairment. Rather, they are an alternative to urine tests that are aimed at detecting illicit drug use.
“While oral fluid testing may provide a better indicator of an employee’s recent use of the drug, it also detects frequent users,” the rule says. “Furthermore, there is no definitive drug impairment test.”
The agency also pushed back on public commenters that said that safety-sensitive workers should be allowed to use marijuana.
“It is important to remember that the beginning of DOT-regulated testing in 1988 was prompted by marijuana-related accidents that occurred in 1985 (two New York City subway accidents) and 1987 (one railroad accident in Chase, Maryland),” the agency said in its Federal Register notice.
More context: The adoption of oral fluid testing comes amid a shortage of truckers who are taken off the road due to off-duty marijuana use. Other federal agencies including the military have been loosening their drug screening rules to accommodate potential recruits who have used marijuana in the past, the New York Times reports.
The impact: The rule goes into effect June 1. But employers will not be able to use oral fluid testing until HHS certifies at least two laboratories to conduct the tests.
HHS did not immediately respond to a request for comment on more specifics of that certification timeline and process.
Still, the DOT’s adoption of this rule could impact research in this area and how non-DOT regulated jobs conduct drug tests. For example, state and local law enforcement have their own testing rules, and some agencies are trialing roadside impairment tests that rely on oral fluid.