Retailers are looking for ways to track marijuana through the production chain, and one tech company is using blockchain to do so in a key partnership with Shoppers Drug Mart.
With the number of cannabis producers and manufacturers increasing significantly, retailers are looking for ways to track marijuana products all the way back through the production chain to ensure their quality — especially when it comes to medical cannabis.
Now, one company is using blockchain technology to increase transparency in production identification for the cannabis space.
TruTrace Technologies (CSE:TTT,OTCQB:TTTSF) and Canadian retail pharmacy chain Shoppers Drug Mart — a subsidiary of Loblaw Companies (TSX:L) — have collaborated to develop a blockchain-secured pilot program for medical cannabis.
Once complete, the program will be used on Shoppers’ recently launched medical cannabis e-commerce platform.
The plan is to use TruTrace’s StrainSecure technology as a central hub for identifying and tracking assets, along with product authentication. It will also be used as a registry for standardized testing and medical cannabis quality assurance.
The Investing News Network (INN) spoke to TruTrace CEO Robert Galarza to offer a closer look into the pilot program that’s catching the attention of the larger cannabis industry.
The goal behind mixing blockchain tech and marijuana
The program was first revealed to the public during the World Cannabis Congress in June this year, and since then it’s moved quickly towards being implemented on Shoppers’ online medical marijuana dispensary.
In order to reach mature drug status and give practitioners confidence in making prescriptions, more information is required about the cannabis pathway from seed to sale. TruTrace’s program is looking to fill that gap.
“Our initial ideation was ‘protect the strains, protect the brands, protect the cultivators that want to protect their intellectual property’ through the use of immutable ledger though blockchain,” the executive told INN.
He said it became apparent, however, that the real goal was about changing the medical industry at large, driving TruTrace to provide the sector with validity and data transparency.
Galarza said a large focus of the program comes down to the patients who use cannabis as a medical treatment, adding that right now there isn’t much information about the ways in which cannabis interacts with other drugs.
An increase in information about the genetic breakdown of the drug could mean more acceptance from the medical community.
Medical cannabis became legal in Canada in 2001 when the Canadian Medical Marijuana Access Regulations grant came into effect.
“There is a clear consensus within the cannabis industry that the source and quality of medical cannabis must be transparent and identifiable in order to meet the expectations of patients and health care practitioners,” Ken Weisbrod, Shoppers’ vice president of business development, said in a statement.
Galarza told INN that, with his company’s StrainSecure technology, Shoppers will have access to a “smart hub linkage” between labs, producers and distributors, allowing information about the products to travel through the supply chain via a secure, decentralized database.
Everything there is to know — from where the cannabis originated to its chemical and molecular makeup — will be safely stored within the program.
Cannabis players already in on the program
While the pilot program originally started with TruTrace and Shoppers, it has taken on several other companies as it’s moved through different testing phases.
An early addition to the program was A&L Canada Laboratories back in July. The Ontario-based research lab is one of the first testing facilities in the verification program and brings with it analytical experience in soil, plant tissue and water testing.
A&L was also one of the earliest testing facilities to receive licensing from Health Canada to test medical cannabis and provide services in cannabinoid profiling and genetic testing.
“Our capabilities in testing through all stages of the cannabis production cycle will fully support the quality assurance mandate of Shoppers,” said A&L President Nevin McDougall.
As a part of the program, A&L will be working with other pilot partners, including WeedMD and Zenabis Global (TSX:ZENA), to provide final test data on medical cannabis products and meet quality requirements for the pharmacy chain.
Anandia Laboratories, a subsidiary of Aurora Cannabis (NYSE:ACB,TSX:ACB), has also jumped on as one of the testing facilities for the program. Anandia President Dr. John Coleman said in a statement that a traceability program for cannabis is important for offering peace of mind to patients.
Taking the lead on genetics testing is Segra International, which signed onto the program through a letter of intent in August, bringing the agriculture technology company into the fold as the primary genetics verification provider for TruTrace.
Segra Chief Scientific Officer Dr. John Brunstein said consistency in customer experience is essential for medical cannabis: “… Individuals often must initially determine variety and dosing to meet their needs.”
On the cannabis side of things, the pilot program features an impressive roster of names in the space.
TruTrace brought the British Columbia-based licensed producer (LP) Zenabis Global into the fold in June, when it confirmed the company would use the StrainSecure platform to register, track and publish testing data about its cannabis plants.
The firm expressed its interest in offering cannabis patients in Canada the assurance of safe, high-quality cannabis.
Dr. Lyle Oberg, chief medical and policy officer of The Flowr Corporation (TSXV:FLWR), echoed the sentiment when Flowr signed onto program. The company has an existing supply agreement with Shoppers to supply its brand of FlowrRx cannabis products.
Quickly following after Flowr was the collection of leading LPs: Aphria, WeedMD and Tilray. All these producers expressed similar excitement for the possibility this program gives.
Most recently, Valens GroWorks (TSXV:VGW,OTCQX:VGWCF) was added to the roster. The British Columbia-based extraction firm was brought on as the first third party processor to enter an agreement with Shoppers to supply cannabis oil-based products to the medical cannabis e-commerce site.
Program envisions mixing blockchain and cannabis
TruTrace said it is on track to launch the program by the end of November this year.
The company completed the first phase of the program in August, which included implementing the platform into the e-commerce system. The second phase is about leveraging the platform to ensure all participants — producers, testers and quality assurance alike — are feeding information into the program, Galarza told INN.
In addition to the cannabis players signed onto the deal, he added that the company’s relationship with Deloitte has been key in managing the communication and strategy aspects of the program.
In a press release, TruTrace noted Deloitte’s position in the cannabis space will “expedite the ability of this technology to reach key stakeholders,” giving players in the supply chain a wealth of information about the products.
While the program was launched in Canada with the Shoppers online platform, Galarza said the company is already planning on implementing its technology beyond its launch point.
“We’re already in talks, at a number of different levels, both from a recreational and medical perspective, both in Canada and the US,” he said.
He mentioned, however, that TruTrace will be focusing its efforts on the partnership it has with Shoppers before expanding the program further.
“We have been in front of some of the top medical doctors and … associations in Canada. And they’re all looking to try to change the sentiment around cannabis.”
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Securities Disclosure: I, Danielle Edwards, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: TruTrace Technologies, The Flowr Corporation and Valens GroWorks are clients of the Investing News Network. This article is not paid-for content.
The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.