The Cannabis Certification Game: Do You Have What It Takes To Be A Global Player?

By Silvia Muñoz.

With the current global shift in cannabis regulations, countless organizations and companies are looking to grow by entering foreign markets and gaining market-share abroad. For this strategy to work, companies may need to make changes to comply with the regulatory standard of the markets they want to enter. However, navigating through the different certification requirements and processes in markets such as Europe, Canada, or the United Kingdom can be confusing, costly, and time-consuming.

To save you some time and hassle, we have researched some of the most common certifications in the industry and how each relates to your company’s success expanding internationally.

The Cannabis Certification Game

Certifications exist as a way to protect users from any harm, ensuring that products are free from contaminants. Every step of the process -- cultivation, production and packaging -- is strictly supervised and well documented.

Being certified is commonly a prerequisite for the export of cannabis and its derivatives. Ensuring the quality, safety and efficacy of products should be a number one priority for cannabis brands, as it helps to maintain credibility and growth for the entire cannabis industry flourishing. While there are various certifications, the most common ones are GMP-EU, cGMP, Novel Foods, among others.

Good Manufacturing Practices (GMP) Certification

According to WHO (The World Health Organization), Good Manufacturing Practices ensure production consistency, testing, stability and rigorous control according to quality standards required by the marketing authorization. Above all, it is a way for manufacturers to guarantee that consumers are not put at risk due to lack of safety, quality or efficacy. (I)

See also: Green Rushed: Why The Tortoise Will Win The Cannabis Race

One of the many misconceptions behind GMP is that it only involves manufacturing practices. Good Manufacturing Practices cover all aspects of the production process, including materials, premises, staff training, record keeping, equipment, storage, hygiene, product development and how complaints are handled. (II)

Specific steps for achieving GMP certification approval are not clearly defined. The reason for this is that you cannot test quality; it is something that is built during all stages of the manufacturing process. Therefore, it is wholly up to the company to define its quality process. GMP certification is mandatory to comply with pharmaceutical manufacturing and most food processing. (III)

Many countries have mandated legislatively that food, pharmaceutical and medical device manufacturers follow GMP procedures and create their GMP own guidelines.

In the United States GMP is overlooked by the FDA ( The Food and Drug Administration).

Benefits of being GMP certified(IV):

• Complying with the relevant regulations
• Risk management in production, safety and quality.
• Develop high standard practices to produce and operate efficiently.
• Robust operating procedures
• Reliability
• Obtain proven management capabilities in product quality and safety assurance.
• International Credibility
• Increases consumers' impressions and loyalty through safety.

Current Good Manufacturing Practices (CGMP)

CGMP is the Current Good Manufacturing Practice regulations enforced by the FDA in The United States. This formal system of controls helps to prevent instances of contamination, mix-ups, deviations, failures, errors, and that drug products meet their quality standards.

The CGMP requirements allow each manufacturer to decide how to implement the necessary controls by using modern technologies and innovative approaches to achieve continuous improvement. Despite the flexibility in how to apply, companies must use updated systems and technologies to meet current minimum standards. (IV)

FDA inspects pharmaceutical manufacturing facilities worldwide, inspections follow a standard approach and rely upon reports of likely defective products to identify sites for which an investigation or research is needed.

When a company's product is not in compliance with CGMP regulations, it is considered "adulterated" under the law. However, it does not mean that there is necessarily something wrong with them. Even when it might violate the CGMP, it could still meet its labelled conditions. The risk that the product is unsafe or ineffective could be minimal. (V)

See also: 3 Reasons Why Entrepreneurs Need To Pay Attention To CBN, The Next Emerging Cannabinoid

Perhaps you are wondering, so what is the difference between GMP and CGMP? They are interchangeable terms, in other countries, the word "current" is not used since companies are supposed to keep up with the different changes in requirements and should continually strive to comply with them. (VI)

Unlike Canada and Europe who have specific guidelines for medical cannabis, the US lacks a uniform regulation at the federal level, which means that depending on each state, there are several local requirements. Nevertheless, states do follow the FDA Controlled Substances Act, and most have included GMP principles from the Code of Federal Regulations (CFR) into their regulations. 

The US hasn't entirely agreed on the existing Mutual Recognition Agreements (MRA), operationally in effect since 2003 between the European Union and Canada, that recognize specific GMP certifications. If you are looking into other markets outside the US, further alignment for world trade will still be required to comply.

Bottom Line

CGMP in the US, GMP-EU in Europe and Guide-104 GMP in Canada are more or less the same. (VII). To manufacture drugs or active pharmaceutical ingredients in Canada, you will need Guide-104 GMP. If you're going to want to sell medicine in the European Union, your facility needs EU-GMP certification. (VIII)Which means that you might need to update standard operating procedures (SOPs) for GMP compliance.

(EU-GMP) Certification

EU-GMP Certification distinguishes medical products from other consumer regulations like Novel Food Regulations.

This certification gives an advantage when it comes to exporting high-margin medical cannabis products to European destinations, as well as enhanced traceability throughout the product supply chain. Only medical cannabis from EU-GMP certified facilities, or the equivalent, can be sold in the European Union. (IX)

Companies can apply for EU-GMP for one step or the entire process of the supply chain. Currently, most companies looking into international markets are pursuing this certification. However, implementing it requires in-depth knowledge of the multifaceted requirements and being able to demonstrate compliance during an inspection.

Novel Foods

According to the European Union Law, ‘novel foods’ are newly developed, food produced using new technologies and production processes, as well as food which has not been consumed to a significant degree by humans in the EU before May 15th 1997.

See also: What We Learned From Working With A CPG Company Looking To Enter The CBD Market

Novel foods fall under at least one of ten specified food categories detailed in Article 3 of the Regulation and are controlled more strictly than regular foods under Regulation (EU) 2015/2283 ("the Novel Food Regulation"). (X)

Manufacturers can only place a Novel Food on the European Market when :

• The European Commission processes the application for the authorisation of the novel food.
• The EC has adopted an implementing act authorising its placing on the market and updated the EU list of novel foods.
• After meeting the criteria laid out in Article 7.
• The food has been proved safe for human consumption, is not nutritionally disadvantageous and the marketing and packaging does not deceive the consumer.

In January 2019, The EU novel foods catalogue was updated to include hemp-derived cannabinoids, including CBD. Manufacturers need to have their CBD supplements, and edible products evaluated and seek permission from authorities to place them on the market. A pre-market authorisation. (XI)

On February 13th 2020, the FSA (the UK Food Standards Agency ) stated that all CBD products on the UK market must have a novel food application through the validation phase of the review process before March 31st 2021. (XII)

The process to get Novel Food approval can take a minimum of 18 months, and it requires sufficient scientific evidence to assure the safety of the food. The current UK’s deadline  of March 31st 2021 establishes businesses have until then to submit and have fully validated, novel food authorization applications and  that no new CBD products can enter without the proper authorisation according to the FSA. (XIII) ; the rest will be removed from the market or face enforcement action from local authorities, which is likely to include criminal prosecution.

Novel Food can only be sold in the 28-members of the E.U. There are three routes for a product to be approved or authorized under the Novel Food regulation:

• By showing a significant history of use in the EU prior to 1997.
• Demonstrating the food is a ‘traditional’ one from a third country, where a history of safe food use for at least 25 years can be demonstrated. Example; chia seeds, and noni fruit juice.
• And finally, a full application based on submission of a dossier for a Novel Food authorization. (XIV)

Authorized Novel Food Products will be a great competitive advantage due to the fact that information will be shared publicly.  However, many wonder whether or not extracts of cannabis will be in the future considered a novel food.

Conclusion

Companies wanting to reach international markets should strive to implement GMP certifications to assure the success of their strategy. However, trying to reach every market might be a formula for failure. We suggest you review your goals, analyse what would be the cost of complying with these certifications, and consider the international impact of each certification.

If you are still not sure what is the right option for your company, hiring a consultant can help you navigate, determine and feel the gaps, before having an inspector coming. This might save you money and could you help you determine a better strategy. Moreover, be prepared that whatever decision you take, you will likely have to make changes and be ready to pay what some might consider a large sum to reach that international credibility.

Lastly, the most important thing is to ensure consumer safety and product quality. Only by understanding the reason behind certifications, will you be able to secure a future within the different markets.

The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

This article does not intend to provide legal advice, and is published only for informational purposes.

Lead image by Ilona Szentivanyi. Copyright: Benzinga.

Noticias sobre cannabis en Español en El Planteo.