The period leading up to the recent federal election has held signs of renewed optimism for many current and aspiring MMPR applicants after a period of relative inactivity on the licensing front. In typical fashion, these positive signs of change cannot be discerned via communication from the regulator.
Instead, as has become customary with everything MMPR, shifts in regulatory activity are discerned through the collective experience of Licensed Producers (“LPs”), MMPR applicants, industry consultants and others who have first-hand dealings with Health Canada on the MMPR licensing front.
So, what’s changing and what could it mean?
1. Staffing
The first (and some would say long overdue) shift is an apparent increase in staffing at Health Canada focused in large part on new inspection personnel. As many will know, there are four types of inspection under the MMPR.*
Most LP sites are inspected monthly. Many applicants go through multiple Pre-License Inspections (“PLIs”). Even with only 26 LPs on the books, Health Canada has had a hard time keeping up with the overall inspection burden. The good news reported through multiple channels is that Health Canada has hired a number of new inspection staff (reports suggest as many as 10-12) with a particular focus on the PLI. What this means for MMPR applicants is that there is more light at the end of the tunnel.
2. Processing of Applications
Having worked on over 60 MMPR applications including multiple LP sites, my security consulting team has witnessed first-hand the evolution of application processing under the MMPR. What we’ve learned is that the handling of applications has gone through stages of maturity. In the past, we’ve seen inconsistency across our MMPR applicant client base (and that of our industry partners on the GPP/QA/regulatory consulting side). Some applications have moved more quickly than others and it has been difficult to discern what the faster-moving applicants are doing that their slower-moving counterparts are not.
But in more recent times we are starting to discern a more consistent pattern. Up until about 6 months ago we commonly saw boilerplate questions from the regulator at predictable stages of the application process. Applicants who were in the ‘Enhanced Screening’ or ‘Review’ phase typically received a number of substantially similar questions on security, record-keeping, quality assurance and other key areas. In some cases the responses to these questions were contained within the materials submitted with the original license application.
Several months ago we saw a number of applicants move from “Security Clearance” to “Review”. More recently, we have seen a number of applicants move from ‘Enhanced Screening’ into ‘Security Clearance’….What we have discerned from this shift is that Health Canada may have freed up more resources to process applications and to move applicants through the process based on the quality and completeness of their submitted application materials.
About six months ago or so we started to see new and slightly more applicant-specific questions. In several examples, Health Canada quoted directly from the Threat Risk Assessment (“TRA”) report which was submitted with the application. In other cases, questions were raised about specific security features and measures unique to the application at hand.
We also noted small groups of applicants being moved between different stages of the application process, in some cases after protracted waiting periods. Several months ago we saw a number of applicants move from “Security Clearance” to “Review”. More recently, we have seen a number of applicants move from ‘Enhanced Screening’ into ‘Security Clearance’.
One trend within these cohorts of applicants moving through the process has been the importance Health Canada seems to have placed on receiving updated and far more detailed information about key aspects of MMPR compliance (as Health Canada interprets it) including security/public safety, record-keeping, quality assurance and operational planning. In one recent case an applicant who submitted a professional TRA report, as well as updated security system drawings and a Security Master Plan, received a letter shortly thereafter advising they had been moved into Security Clearance after an almost 2-year wait.
What we have discerned from this shift is that Health Canada may have freed up more resources to process applications and to move applicants through the process based on the quality and completeness of their submitted application materials. These are all good signs of course and underscore the importance of submitting a very fulsome application and follow up submission materials to paint a clear picture of the applicants’ business operations and conformance with the Regulations. The key here, as Health Canada has stated on the public record, is quality, completeness and demonstrating operational readiness.
3. Signs of Imminent Pre-License Inspections
Perhaps the most significant sign of change involves a select number of applicants in the ‘Review’ stage who have recently received new letters from Health Canada which seek to confirm compliance with key Division 3 (security) and other MMPR provisions as the “final step” prior to setting a date for the Pre-License Inspection.
This very meaningful development seems to coincide with the hiring of the new Inspectors (who presumably are finalizing their training and preparation to undertake a new swath of PLI’s). The fact that we have been contacted by applicants to perform pre-PLI walk-throughs of sites to validate readiness is another sign that movement on the MMPR licensing front appears to be imminent.
4. Conclusions
The developments outlined above, coupled with the new Liberal-majority Government in Canada, appear to be very positive signs for MMPR license applicants (and LPs). What are the key takeaways?
New and early-stage MMPR applicants should remember that the quality and completeness of their application is paramount considering that Health Canada seems to be reviewing all applications far more thoroughly and linking what they find (or don’t find) in submitted materials to the expediency of movement through the application process.
Mid- and late-stage applicants typically fall into two camps. For those who have stayed on top of the evolving regulatory requirements and submitted updated materials to Health Canada, it’s a matter of staying the course and finalizing preparations for Health Canada’s approval to build-out or confirmation of a PLI date (i.e., for those who built out in advance). For mid- and late-stage applicants who have not kept abreast of regulatory developments and/or have not provided the regulator with updated written materials, it would be wise to assess the sum of application materials submitted to identify and address any gaps. Our experience suggests that those applicants who stay abreast of Health Canada’s evolving regulatory expectations and submit updated plans and commitments to Health Canada have a far better chance of moving more quickly and successfully through the arduous MMPR licensing process.
For those fortunate few applicants who appear to be close to undergoing a PLI, remember that the Inspectors have two fundamental objectives. Firstly, to ensure that what was committed to by the applicant through the application process is reflected in the built-out facility and operational plans. Secondly, to ensure conformance with all facets of the MMPR and the Directive on Physical Security Requirements for Controlled Substances (and how Health Canada interprets these somewhat evolving compliance requirements).
Feature Image of Vida Cannabis, Stellarton, Nova Scotia
~David Hyde
David holds a Master of Science Degree (with Distinction) in Security and Risk Management from the University of Leicester and a Certificate in Security Management from the University of Calgary. He has completed The Wharton School Development Program for Security Executives and is a Certified Advanced Level C.P.T.E.D. Practitioner. He is certified to perform Threat Risk Assessments and is regularly called upon by legal counsel for expert testimony on the adequacy of facility security programs. For the past ten years, David has taught crime prevention and security at the University of Calgary.
David Hyde & Associates is a full service security consulting practice based in Toronto and operating across Canada. The firm offers independent, high quality security and crime prevention advisory services based on a defensible framework of applicable laws, regulatory standards and industry best practice. David Hyde & Associates has extensive experience in security consultation within the burgeoning commercial medical marihuana sector
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