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Three Things Medical Marijuana Startups Need to Thrive Despite Regulatory Uncertainty

June 28, 2018 | Matthew M. Lowe

The medical marijuana industry is being heralded as the new frontier in the life sciences, thanks to the potential of cannabis-derived products in treating ailments that range from chemotherapy-induced nausea to epilepsy and neuropathic pain. If you’re a startup in the industry, what does this mean for you? In a nutshell, it means opportunities abound, but regulatory uncertainty remains.

For the medical marijuana industry to earn public trust, it must find a clear regulatory path. The industry’s journey toward that path resembles what the nutraceutical and tobacco industries faced in the past.

Nutraceuticals and cigarettes are popular among consumers throughout the world, but their manufacturers suffered the stigma of being unregulated for a long time. Without the stamp of regulatory approval, many people considered dietary supplements dubious. Likewise, cigarette companies were deemed unethical.

It wasn’t until 1994 that the U.S. Food and Drug Administration (FDA) began to regulate the nutraceutical industry under the Dietary Supplement Health and Education Act.1 The FDA’s regulation of tobacco products came in 2009, prompted by the Family Smoking Prevention and Tobacco Control Act.

FDA and medical marijuana

The FDA’s present dealings with the medical marijuana industry is focused largely on providing scientific advice and monitoring false marketing claims pertaining to marijuana’s medicinal properties. The agency has not approved any marketing application for the use of botanical marijuana for any indication, but it has approved three medicines with synthetically derived cannabinoid-based components. Those drugs are Marinol, Syndros, and Cesamet.

The FDA is expected to make a decision soon on Epidiolex, a marijuana-based drug for treating rare forms of epilepsy. It’s a pharmaceutical-grade form of cannabidiol (CBD), an oil found in marijuana plants grown in greenhouses. As such, Epidiolex is a new class of drug. A panel of experts formed by the FDA has unanimously recommended that the agency approve the drug.

Three things you need

These positive developments have fueled the optimism of medical marijuana companies looking to enter the life science industry. If your company is part of this innovative group, you’re going to need three things to succeed in a regulatory environment currently in flux.

1. Adopt document control as a best practice from day one

In the regulated environment, document control refers to formal procedures for approval, distribution, and change of essential documents, and the designation of a person or people to implement those procedures. The FDA’s guidance for the pharmaceutical industry on the Current Good Manufacturing Practice (CGMP) regulations specifies the need for document control procedures as an integral part of the quality system.5

If you’re planning to enter the life science industry, adopt document control as a best practice from the get-go. It’s an important requirement for you as a supplier or a contract research organization (CRO), and especially as a sponsor and manufacturer of a new drug.

From my own experience working for medical device firms as a product development engineer, automating the document control process cuts down the review and approval turnaround time significantly. Integrating document control with a learning management system also ensures that training tasks related to document changes will be performed promptly.

2. Use change control and risk management processes to boost product safety

If your organization is involved in cannabis-related R&D, you should brace for a long, iterative process that will require strong change control and risk management processes. Change control and risk management are important CGMP concepts that help prevent unintended and unsafe consequences in the process of developing and manufacturing medical products.

Lay the foundation for compliant and efficient processes from the start, preferably with a robust electronic platform. Although startups can get by with paper-based processes, most of them end up wasting a lot of time and money once they realize a manual system can’t grow with their organization, and they have to switch to an automated system.

3. Establish an effective collaborative environment for compliance

If you are going to submit an investigational new drug (IND) application, you will be dealing primarily with the FDA. The involvement of cannabinoids in your research also means working with additional agencies, namely the Drug Enforcement Agency, the National Institutes of Health, and the National Institute on Drug Abuse.6

Whether you are going to be a sponsor, a CRO, or a supplier, you are going to need a collaborative environment from the get-go. Establish a system that will connect internal and external stakeholders in real time. Your ability to collaborate with others, from consultants and clinical trial personnel to regulators, is critical to your success.

Are you ready to go?

There’s a lot of wisdom behind the motto, “be prepared,” especially in an industry like medical marijuana that’s poised to blaze a trail. As a startup, your company should always be ready to go by being efficient, effective, and compliant.

A state of preparedness calls for leveraging the latest technology. As a life science veteran who survived the paper-based processes of old, I recommend that you take advantage of a fully automated and integrated quality, compliance, and business system. Leverage cloud-based solutions that require minimal investment and no dedicated staff.

Having the right system in place will facilitate compliance and accelerate time to market. It will distinguish your company from your competitors and make it more attractive to potential investors.


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