Pubdate: Mon, 01 Jan 2018
Source: Globe and Mail (Canada)
Copyright: 2018 The Globe and Mail Company
Author: Grant Robertson
Page: A1


Licensed marijuana producers caught using banned chemicals could pay
up to $1-million

Federally regulated marijuana companies caught using banned pesticides
that put consumers' health at risk will now face fines of up to
$1-million per violation, The Globe and Mail has learned.

The fines will be enshrined in federal legislation as a way to clamp
down on unauthorized use of dangerous chemicals by licensed cannabis
growers, according to Health Canada.

The new penalties come after an investigation by The Globe this year
revealed banned-pesticide use in the medical-marijuana industry was
far worse than the government realized, resulting in serious health
consequences for people exposed, including cancer patients who took
the drug to ease their pain.

The legislative changes will "provide the Minister of Health with the
authority to issue an administrative monetary penalty of up to
$1-million per violation to a licensed producer for a violation of the
Act or its regulations," Health Canada spokeswoman Tammy Jarbeau said.
Any company that does not comply with the fines could have its
operating licence suspended or revoked.

The Globe's investigation found evidence of intentional use of banned
pesticides within the industry, and exposed gaps in Health Canada's
oversight, including that it did not require product safety tests to
ensure such chemicals weren't being used. The medical-marijuana
industry is a precursor to the legalized recreational market, which is
set to begin in mid-2018.

A former employee of Mettrum Ltd. told The Globe he witnessed staff
spraying plants with the banned pesticide myclobutanil as far back as
2014, despite them knowing it was prohibited by Health Canada. To
evade detection, Thomas McConville said, staff hid the pesticide in
the ceiling tiles of the company's offices whenever government
inspectors visited the site.

In another case, The Globe arranged for a patient of Organigram Inc.
to have several unopened containers of recalled marijuana tested at a
federally approved lab. The results showed evidence of five
unauthorized pesticides - three more than Health Canada knew about
when the products were originally recalled.

Health Canada also announced in May that mandatory safety testing on
all products would be introduced prior to the government's plan to
legalize cannabis for recreational use. That move came after Ottawa
originally told The Globe that such steps weren't necessary because
companies knew banned pesticides were illegal, and therefore shouldn't
be using them.

The introduction of financial penalties for companies who break those
rules is the latest example of the government's attempt to crack down
after the investigation.

The fines are being welcomed by industry members and

Neil Closner, chairman of the Cannabis Canada Association, which
represents roughly a quarter of the 80 or so licensed cannabis
producers in Canada, said the fines should be effective in dealing
with companies that don't want to follow the rules.

"We believe when fairly applied, [the fines] can be a useful and
effective tool for Health Canada to ensure proper adherence to the
rules if other mechanisms fail," said Mr. Closner, who is also chief
executive officer of MedReleaf Corp., a licensed grower based in Ontario.

Product recalls at several medical-marijuana companies over the past
year have impacted thousands of people. The Globe's investigation
detailed in August how patients who were prescribed the cannabis for
medical reasons developed serious and unexplained illnesses, including
severe weight loss, nausea and abdominal pain, after consuming
products contaminated with illegal chemicals.

One of those patients, Scott Wood, a former military policeman who was
exposed to the chemicals after being prescribed medical cannabis for a
serious back injury suffered while serving, said the fines were long
overdue. Mr. Wood said he lost an alarming amount of weight, developed
strange blistering rashes, debilitating headaches and lung problems
after consuming medical cannabis that he believed was clean, but was
instead contaminated with several banned pesticides.

"I think it's a positive step forward," Mr. Wood said of the new
penalties. "You would think the companies are all going to think twice
before they use anything they're not supposed to."

The fines are significant, given that the government will soon
legalize recreational cannabis after it began issuing licences four
years ago for companies to serve the medical market. The move will end
nearly a century of prohibition. Cannabis consumption is expected to
rise sharply when the legal market arrives next summer, as provinces
begin selling the product online and through government-regulated

Mr. Wood, who sought treatment at the Mayo Clinic in the United States
for his health problems, said he wishes the penalties were in place
before he was prescribed the products last year. He said he hopes
Health Canada uses the fines whenever companies are found breaking the

"I personally think it should be more than $1-million," Mr. Wood said
of the penalties. "But at least they're taking a step forward."

Mr. Closner said the scrutiny around pesticide use over the past year
will hopefully make the industry "more vigilant" in the future.

"This has only strengthened the industry," he said.
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