The Plain Packaging Dilemma of Legalized Cannabis in Canada

by Ryan Szporer

There’s still a lot of work to do before cannabis gets legalized in Canada on October 17.

 

Compliance with the Cannabis Act

One of the highest items on producers’ priority lists will undeniably be ensuring compliance with the “Cannabis Act.” That involves toeing the line regarding packaging regulations, which haven’t impressed either companies in the emerging industry, who find them too restrictive, or some big tobacco players, who find them too lax, relatively speaking.

For example, Canada’s largest tobacco company, Imperial Tobacco, has gone on record through head of corporate and regulatory affairs Eric Gagnon as pointing out cannabis companies can include a graphic like a logo on packaging, whose format they can choose and add color to. Those are things tobacco companies cannot do under their new regulations.

Health Canada has explained the discrepancy by arguing the two industries require different approaches, saying in an email to Global News: “While regulations for both substances are based on evidence and on the common objective of protecting Canadians—especially youth—they are different products with different risks…”

Nevertheless, it’s difficult to overlook the similarities between the two, as each product is required to be sold in overwhelmingly plain packaging, which, Gagnon conceded, “limits their [cannabis producers’] ability to sell themselves.”

While Gagnon could have theoretically been speaking of constraints to the tobacco industry, he had been referring specifically to details surrounding a given cannabis brand’s aroma being banned (among other elements). The thought process here is to deter interest in children. It’s an interesting dynamic the government has created, requiring itself to toe a line as well, this time one between making the overwhelmingly popular decision to progressively legalize cannabis and not being seen as too soft on the drug.

 

Cannabis Challenge with Contraband

Jamie Goren, the director of North American sales for IMS, agrees some of the packaging requirements for cannabis are stifling, arguably unnecessarily so. Goren, who has over 25 years of professional experience in the printing and packaging space, sees the pharma template for packaging in Canada as being the better fit.

“When the government was making regulations and trying to establish a template for where to go in terms of packaging regulation, it was easy for them to retrofit existing tobacco rules or borrow from existing tobacco rules,” he said.

“They could have gone with a pharma template, where medical marijuana followed prescription drug rules and maybe recreational would have followed over-the-counter drug rules down the road. Instead they borrowed from tobacco, which is a little strange, because tobacco is an industry they’ve arguably been trying to kill for the last 20 years.”

Adding to the difficulty is the threat of black-market substitutes encroaching on sales. Keeping guidelines restrictive would lead to an unfair advantage for legal cannabis’ illegitimate counterparts. After all, flashier packaging can create the illusion of a superior product. Meanwhile, the plain packaging would be all too easy to counterfeit.

“Like any other consumer good, if you remove the branding element and a way for consumers to differentiate between a legal and an illegal product, it’s very easy to copy a legal product,” said Gagnon on the subject of tobacco in a piece appearing in The London Free Press.

It’s a conundrum that further complicates Canada’s position on the matter. The Canadian government can be seen as trying to accomplish a variety of goals by legalizing cannabis, including to protect consumers through the establishment of a high-quality, above-board supply of the product, i.e., the elimination of the black market. The plain packaging it’s enforcing as a requirement could end up being a boon to it instead.

 

Accuracy as a Substitute for Branding

As a result, compliance with the approval process may very well ironically end up a key differentiating factor for producers. It may become less about branding and more about accuracy in such an instance.

“I think it’s a matter of being accurate the quickest. I think the two go hand in hand. It goes back to the issue of being in a regulated industry and making sure you’re following all the guidelines,” said Goren.

Suggesting digital proofreading software as the best way to save time approving packaging and getting to market with compliant packaging, Goren said it boils down to increasing efficiency. As daunting of a task entering the cannabis industry seems, lessening the workload for producers is possible and potentially a key to success.

“If it has to be approved by an outside body like Health Canada, you want to ensure the least amount of revisions and the least chance that something goes wrong and that you require a recall once it’s already out there,” he said.

“You could set up higher-speed production lines or engineer efficiencies into the manufacturing process that might drive 5-10% more efficiency on an hour-to-hour basis, but if you can get packaging through the approval process and onto the production line three days earlier, you’re going to be 200% ahead of the game in the long run.”

And whoever gets to market quickest effectively has the best chance at winning that game.

Find out more on the legalization of cannabis in Canada in the following episode of our web series, Unpacked. For additional information on how GlobalVision can help you improve the efficiency of your packaging workflow, visit our website or contact us.

 

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