Kristina Etter   |   November 16, 2022

The Cost of Cannabis Safety

Mandatory testing for contaminants and pesticides is a significant expense for cannabis cultivators.
Kristina Etter spent 20 years in corporate IT with a niche in mobile technology and IoT in agriculture. Today, she combines her love of technology with a passion for cannabis as the Editorial Director for Cannabis Tech.

Where there is a profit to be made, consumer safety must always be the top priority. Without proper testing and analysis, shady operators can resort to questionable practices in order to cut costs and increase profits. Mandatory testing for contaminants and pathogens not only protects the consumer but also levels the playing field for producers and reduces potential crop loss due to contamination.

The Cost of Safety

The required testing and analysis for commercial cannabis is a steep but necessary expense for ethical cannabis producers. A report from 2020 indicated that the cost of testing was approximately $136 per pound of cannabis produced or roughly 10% of the average wholesale price.

Today, Cannabis Benchmarks estimates the average cost of a pound of cannabis at $992. Some regions have been rumored to see prices as low as $700-750 a pound. Without factoring in a rise in the price of testing or increased labor costs, mandatory tests could consume between 13 to 20% of a grower’s profits.

Colorado’s Approach to Cost Reduction

In Colorado, the MED Rule 4-120 establishes a reprieve for those producers who consistently toe the line. Producers who pass all contaminants testing can be granted a “Reduced Testing Allowance” for one year. The Code of Colorado Regulations states:

A Regulated Marijuana Cultivation Facility’s cultivation process may achieve a Reduced Testing Allowance for contaminant testing if every Harvest Batch that it produced during at least a six-week period but no longer than a 12-week period passed all contaminant tests required by Paragraph (C) of this Rule. This must include at least six Test Batches. A Medical Marijuana Cultivation Facility, a Retail Marijuana Cultivation Facility, or an Accelerator Cultivator can achieve a Reduced Testing Allowance for all contaminants listed in paragraph (C) of this Rule at the same time or separately for each contaminant.

New Technology Offers More Cost-Savings

PathogenDx recently announced the launch of Octa as a solution to reduce the expense of mandatory testing for cannabis producers. For Milan Patel, company CEO, consumer safety is always top of mind, but he also understands the economics of doing business.

“Consumer safety has been and should continue to be a top priority for the cannabis and hemp industries. However, we’ve seen a massive rise in scale over the years that needs to be met with more optimal testing operations,” Patel acknowledged.

“Octa™ AutoPrep Station is our answer to this problem, as it’s been designed to provide exceptional utility and economic value to cannabis and hemp testing labs,” he added.

The Key is Speed & Efficiency

This new technology increases efficiency through redundancy and replication. The AutoPrep Station handles 24 samples in a 96-well plate or eight samples per run. With an average of 37 seconds of hands-on time, the Octa™ offers a reduction of 1 hour and 18 minutes per 8-hour shift.

Patel stated, “Octa™ drives operational efficiency by offering 88% lower labor costs, up to 8x less consumable waste, and 73% less hands-on time.”

Benefits Beyond Dollars and Cents

In an era of green technology and solutions, cost reduction shouldn’t be the only driving factor in business decisions. Protecting the environment and reducing waste is also a high priority for top cannabis operations. The Octa™ reduces consumable waste by as much as eight times other technologies.

Patel also explained, “In addition to the substantial cost savings, the use of this device has been simplified to the point where literally very little training is needed; essentially, anyone can run it with a touch of a button, taking the variability out of the equation that is inherent in technicians that process lab samples manually.”

Technology Driving the Future of Cannabis

Without question, the cannabis industry will continue to shift and evolve as the market grows and the legal landscape changes. Like any other industry, the cannabis industry must make sound economic decisions in order to thrive. Technology solutions can help producers scale, maintain compliance, and increase overall profits.

“Our hope is that the increased efficiency delivered by Octa™ will greatly increase the productivity of testing labs, ultimately leading to a safer industry overall,” Milan concluded.

 

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