Under new proposed regulations discussed at a policy forum Friday, Colorado cannabis manufacturers would no longer be able to choose which product samples are sent for mandatory clinical testing.
Instead, the state’s Cannabis Enforcement Agency could require independent laboratories or outside vendors to collect product samples for necessary testing to ensure the products are free of contaminants before companies can sell them.
The changes would address long-standing complaints from some cannabis manufacturers that bad actors are gaming the system. Some companies are sending products to pharmacies that may be contaminated with chemical solvents, fungi or pesticides, while selecting samples that can pass tests, he said.
A Denver Gazette/ProPublica investigation last month found that the marijuana product testing system relies on honor codes that are susceptible to tampering.
In 2024 alone, Colorado officials found 20 incidents in which companies violated testing rules, including submitting samples different from those sold in stores or using unlicensed chemical treatments, according to a review of enforcement actions by news organizations. State rules for sample selection require that what is turned over to the lab is representative of what marijuana companies actually deliver to dispensaries for sale to consumers.
“Sample contamination is a common violation,” Kyle Lambert, the department’s deputy director, said at a policy forum. “This is something we’re interested in addressing more comprehensively based on what we’ve seen.”
Colorado officials have long prided themselves on creating the nation’s first regulated recreational cannabis market, but as other states adopt stronger regulations, Colorado is falling behind, news outlets reported.
The Denver Gazette and ProPublica featured a story about how popular brands of e-cigarettes contaminated with toxic chemicals ended up in marijuana dispensaries. In this and other cases, regulators found that manufacturers were replacing marijuana distillate, the liquid in e-cigarettes, with a much cheaper product chemically converted from hemp, which is banned in Colorado. Ware House surrendered its marijuana manufacturing license. The owners declined to comment Tuesday.
The Cannabis Enforcement Agency first announced in January that it was considering a new sampling system. The state’s move marks a shift, as the state last year fought a lawsuit by marijuana growers aimed at forcing the department to overhaul its inspection rules. The lawsuit filed by Mammoth Farms asked the department to prohibit manufacturers from selecting product samples for testing. Lawyers for the department said in a court filing that such an amendment would be “unworkable.”
A Denver judge in May dismissed the lawsuit on technical grounds, saying the company should have first asked regulators for a rule change. After the firings, Mammoth Farms asked the Marijuana Enforcement Agency to change its rules. The department agreed this summer to require more chemical testing, but did not adopt a proposal to overhaul sample collection methods.
The department’s senior director, Dominic Mendiola, said in a statement that the move to consider changes stemmed from concerns raised by marijuana companies last year.
“The department is committed to further investigating this topic and leading the facilitation of dialogue with stakeholders to analyze the details and feasibility necessary to implement the recommendations to transition to third-party test batch collection requirements,” she said.
Twenty-six states and the District of Columbia require testing personnel to collect samples to ensure that manufacturers do not cherry-pick products for testing while withholding contaminated products.
Lambert said the state will spend the next few months consulting with testing agencies, cannabis growers, manufacturers and industry experts to develop a formal proposal. He added that he expects the department to take up concrete policy recommendations this summer.
Lambert said state officials want to understand costs and ensure effective regulations are in place. The state is also considering who will collect the samples: licensed laboratory personnel or state-qualified third-party samplers.
Kareem Kasem, director of SC Labs, which has a testing lab in Colorado, said at the forum that all sampling should be done under video surveillance and that vehicles transporting samples should be equipped with GPS monitoring.
Other industry representatives noted that changing testing regulations could be costly, and that costs could be passed on to consumers. He also highlighted that there have been marijuana testing scandals in other states, even when samples were taken by lab personnel.
Stephen Cobb, co-owner of cannabis manufacturer Concentrate Brands, pointed to the sampling scandal in California and said the problem was resolved only after regulators intervened.
“Sample fraud can only be solved if there is a huge investment in regulatory oversight of it. If not, it’s just a waste of money,” Cobb said.
The Marijuana Enforcement Agency said cost and budget issues will also be part of the discussion.
Still, Justin Singer, CEO of Denver-based cannabis company Ripple, praised the sector’s move.
“I think sample fraud should be a death sentence for licensees,” Singer said at the policy forum. “At this point, it’s a $15,000 slap on the wrist.”
He tracked the department’s enforcement activities and provided spreadsheets and links to those cases to the Denver Gazette and ProPublica. According to Ripple’s analysis, half of the 135 final enforcement actions states have taken against marijuana companies since the beginning of 2023 involved self-sampling and testing issues.
Singer is also pushing for a legislative overhaul of the state’s cannabis testing system, which would transfer testing oversight to the Colorado Department of Public Health and Environment and create a program in which state regulators would randomly test product from dispensaries to make sure it’s not contaminated.
“I hope we can all agree that if we as an industry are not giving consumers what they think they are buying, we are destroying our own industry from within,” Singer said. “Sample fraud and test fraud is a cancer on our industry. It’s a cancer on companies trying to do a good job. It’s a cancer on laboratories trying to be honest.”
