Cannabis Traceability: Problems & Solutions -- CFN Media

Seattle, WA, April 03, 2019 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE -- CFN Media Group (“CFN Media”), the leading agency and financial media network dedicated to the North American cannabis industry, announces publication of an article discussing Helix TCS Inc. (OTCQB: HLIX), a leading provider of critical infrastructure services for the legal cannabis industry, and how they have become an evident leader in providing traceability solutions—solutions that have a growing need as states continue to experience issues.

The global cannabis industry is projected to reach $146.4 billion by 2025, according to Grand View Research, representing a 34.6 percent compound annual growth rate over the time period. Despite these rapid growth rates, the industry has faced several high profile traceability issues in Washington, Nevada, Michigan, Oregon, and Pennsylvania, including diversion into the black market, product recalls from contamination, and lost revenue from traceability issues.

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Supply Chain Integrity

Oregon’s legal cannabis industry generated about $250 million in revenue in 2016, which was nearly six times more than official expectations. While the growth has been impressive, there is between 132 to 900 tons more cannabis grown than sold in the state. The excess cannabis often flows out of the state without a trace in what regulators call diversion. Growers are selling excess production into the black market to grow their revenue.

Nevada’s cannabis industry experienced a related setback when an audit revealed that discrepancies in data entry by marijuana businesses may have cost the state more than $500,000 in tax revenue over a six month period. In addition, the audit found that high-potency products meant for medical marijuana patients were sold to recreational customers in 43 percent of cases, threatening the health and safety of consumers.

Many states require cannabis businesses to track their products across the supply chain to reduce diversion. By establishing a chain of custody, regulators can ensure that no cannabis product goes missing or moves out of state. The technology used to trace cannabis throughout the supply chain ranges from conventional labels to genetic biomarkers that are absorbed into cannabis plants through water and soil.

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Product Recall Support

Michigan’s relatively new medical cannabis market has already experienced recalls due to contamination. In February 2019, the state recalled six batches—or more than 50 pounds—of medical marijuana available on the state’s regulated market since January. The caregiver grown product was contaminated with chemical residue, E. coli, arsenic, cadmium and Salmonella—all potentially dangerous to an already-vulnerable patient population.

These problems aren’t limited to the United States. As more countries implement legal cannabis programs, there has been a struggle to craft cultivation and testing standards that are effective in preventing contamination issues. Even Health Canada continues to issue product recalls on a regular basis despite the country having one of the most advanced cannabis regulatory frameworks in the world.

While quality assurance testing is instrumental to avoiding these issues, there will always be contaminated product that slips through the cracks since it’s impossible to test every single product. Traceability solutions can help immediately recall tainted products and even alert specific patients or consumers that they may have purchased tainted products. That way, the damage is minimized and solutions can be found to avoid future problems.

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Leading Traceability Solution

Helix TCS’ BioTrackTHC has become the clear market leader in providing traceability solutions. Upon propagation, each plant or clone is assigned a unique 16-digit identifier that records and archives the plant’s phases, additives, and employee interactions through maturity. At harvest, each batch of cannabis is assigned a new identifier that contains the plant history since propagation and includes pre-packaged goods or derivatives (e.g., oils).

Cannabis batches undergo independent testing and a detailed manifest is prepared prior to transporting the cannabis between licensed businesses. BioTrackTHC also integrates with hardware for patient ID printing and sales limitations that can be easily validated in real-time using the system.

Regulatory agencies and law enforcement in some states can access a secure, online portal to track cannabis transportation and inventory in real-time. Detailed financial reports can also be generated for the Department of Revenue or other agencies responsible for taxation. This ensures that cannabis companies are compliant with chain of custody requirements, as well as held responsible for paying their fair share of taxes.

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Expanding into New Markets

Helix TCS Inc. (OTCQB: HLIX) has already become a leader in providing traceability solutions to both U.S. states and international markets. With over 2,000 customers in 34 states and six countries, the company’s traceability and point of sale technology has processed over $18 billion in cannabis sales. The company continues to expand its presence with new agreements in international markets, as well as expansion in domestic markets.

In March alone, the company deployed North Dakota’s Government Cannabis Traceability Program, which uses BioTrackTHC to trace the state’s entire medical cannabis supply chain for compliance and regulatory oversight; extended its contract with Hawaii for one-year to power the state’s cannabis traceability program; and, extended its agreement with Delaware to power the state’s medical cannabis traceability system for two years.

Investors may want to take note of these trends, as the company continues to cultivate its leadership position in traceability solutions for the cannabis industry worldwide. For more information, visit the company’s website at

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