Charting New Highs: How Cannavigia Navigates Compliance Landscape and Litigation Risks in the Cannabis Industry

Leaders League: How does Cannavigia help clients establish and maintain trust in the sensitive cannabis industry?

Philipp Hagenbach: At Cannavigia, trust hinges on two key areas: legal frameworks and standards of quality. We prioritize quality and compliance, developing our software tailored to legal requirements for cannabis production and monitoring, set by entities like the Ministry of Health or specific narcotic agencies. Our approach involves being a center of excellence, deeply informed in our field. Our software adheres to international quality standards the GPP (Good Pharma Practices) such as GACP (Good Agriculture and Collection Practices) and GMP (Good Manufacturing Practices), which are more than guidelines; they are essential frameworks.

Compliance in medicinal cannabis isn’t merely preferred; it’s legally mandated. Standards like GACP and GMP are vital benchmarks for producing medicinal cannabis. We understand the legal frameworks of the countries we operate in, ensuring we meet standards of quality and appreciate legal nuances.

The cannabis legal landscape is ever-evolving. In Switzerland, for example, significant changes to the Narcotics Act in 2021 allowed the fundament for the research into regulated recreational cannabis markets, despite the UN’s classification of cannabis as a class 1 narcotic. Our role in Switzerland includes a 10-year contract with the Federal Office of Public Health to monitor and trace cannabis in pilot trials, ensuring compliance and public health safety. Collecting and providing the data for the assessment of the future legal process. This meticulous tracking process, from seed to end consumer, is part of our commitment.

Through Swiss pilot trials, we aim to showcase effective traceability and compliance mechanisms. Critically, these trials are not only for Switzerland but also serve as a model for other countries exploring cannabis legalization. We provide a reliable system for tracking and monitoring cannabis production and consumption, contributing to understanding how regulated markets can operate safely and align with public health goals such as harm reduction for consumers and legal requirements. This mirrors the trend towards more liberal cannabis policies in Europe, in line with public sentiment and evolving legal frameworks.

At Cannavigia, trust hinges on two key areas: legal frameworks and quality standards. We prioritize quality and compliance, developing our software tailored to legal requirements for cannabis production and monitoring.

How does Cannavigia anticipate and manage potential litigation risks in the rapidly changing legal landscape for cannabis, both in Switzerland and elsewhere?

At Cannavigia, our primary objective is to prevent any legal issues for clients using our software, particularly in the medicinal cannabis sector. We assist clients in obtaining the necessary licenses from regulators and ensuring compliance with standards of quality. Beyond compliance, our software plays a crucial role in 'narcotics accounting,' managing and reporting cannabis stocks, including inventory, circulation, exports and imports, to the relevant narcotics authority in each country.

We also work closely with third-party laboratories for external quality control, establishing a comprehensive ecosystem to uphold industry-required quality and safety standards. Our all-encompassing approach, which includes ensuring license compliance, fulfilling reporting obligations, managing waste, and maintaining quality control, equips our clients to adeptly navigate the complex legal environment. This strategy significantly reduces the risk of litigation or legal issues, ensuring our clients’ operations remain within the law in their respective (export) countries and jurisdictions.

We only operate in countries with a legal framework for cannabis cultivation and production, actively engaging with regulators to demonstrate our software’s effectiveness.

How does Cannavigia adapt its approach in different jurisdictions while maintaining global standards, and how is transparency assured in the face of regulatory scrutiny?

Cannavigia’s approach is versatile, focusing on the medicinal aspect of cannabis with a core emphasis on global standards while also adapting to local variations. Standards like the EU GMP are generally uniform worldwide but may vary slightly between countries. We help producers in regions like Europe, Africa and Asia Pacific meet these standards for international market access. In the recreational sector, largely restricted in many countries, our strategy is more customized. We closely follow changes of policy and adjust our software to meet specific reporting needs and legal frameworks, especially in European countries, like Switzerland.

Transparency is fundamental to Cannavigia’s operations. Our software is built on three layers to ensure this:

Transparency: This allows clients to track their processes and products at every stage, providing crucial information to both end customers and regulatory bodies.

Quality: We offer tools for monitoring and control which adhere to standards of quality, facilitating compliance with internal and external processes, and integration with laboratories.

Management: This helps clients effectively manage their operations, offering data-driven insights for scalability and efficiency.

Furthermore, we enhance traceability by providing QR codes on final products that give detailed, batch-level information. This multi-layered approach to transparency and quality control puts our clients in a good position to navigate regulatory environments and stay ahead of potential investigations. Additionally, transparency creates trust with customers and consumers and eventually creates a competitive advantage for quality products.

Our software plays a crucial role in managing the narcotics value chain and reporting cannabis inventory to the relevant narcotics authority in each country.

How does Cannavigia monitor changes to the law and the progress of cannabis related litigation, particularly concerning banking acts?

At Cannavigia, we are closely monitoring for example the SAFER Banking Act’s progress in the United States, a significant piece of potential legislation due to the federal illegality of cannabis and the operational level of most banks. This creates challenges in states where cannabis is legal but not recognized federally, impacting the banking operations of cannabis producers. Similar challenges are observed in countries like Colombia, but in regions like Switzerland and Europe, these issues are less prevalent. Companies operating legally in the medicinal cannabis sector typically don't face banking obstacles, except when banks opt out of the cannabis industry.

We focus on integrating banking and insurance services into our ecosystem, leveraging the transparency provided by our software. By demonstrating detailed, compliant operations daily, we make our clients more appealing to financial institutions and insurers. This approach is crucial, as litigation in the cannabis sector significantly influences debates on legalization and often empowers those against it.

Besides regulation, entering new markets in the cannabis industry requires understanding and adapting to diverse regulatory environments. Our presence in more than 20 countries means we must be versatile in meeting different compliance and operational demands. We engage proactively with regulators, often before a legal framework is fully established, to provide case studies and demonstrate our software’s effectiveness. This active engagement and understanding of local requirements are key in navigating the complexities of new markets in the cannabis industry.

Interview by Aude Ghespière