Missouri strips weed license from company accused of selling unauthorized products

Rich Sugg/

Missouri marijuana regulators on Thursday stripped the license of a manufacturing company accused of selling unauthorized products in the state’s new legal market.

The Missouri Department of Health and Senior Services announced on Thursday a slew of violations by Delta Extraction, a marijuana products manufacturer based in Robertsville, about 45 miles west of St. Louis. The state had previously issued a recall on the company’s products due to their potential threats to public health.

“We must be clear on this: Businesses that choose to participate in Missouri’s marijuana industry do not get to decide which rules and which parts of (the state constitution) they want to follow,” said Amy Moore, director of the DHSS division of cannabis regulation.

Thursday’s announcement comes amid a bevy of controversies surrounding Missouri’s new marijuana industry after voters voted to legalize weed last year, including predatory practices involving a state-run program designed to help underserved groups break into the marijuana market.

The revocation of Delta Exctraction’s license stems from its alleged practice of selling products in Missouri’s regulated market that were not properly tested. The company is accused of taking THC-A, a non-psychoactive THC concentrate, and converting it into THC, the substance in marijuana that causes users to feel its effects — a practice prohibited by Missouri’s industry, according to the state.

The state also found a slew of other violations by the company, ranging from falsifying data to failing to comply with various security measures surrounding its products.

Chuck Hatfield, a Jefferson-City based attorney who is representing the company, said in a statement that the state’s decision was “illegal and unfounded.” Hatfield previously worked in the Missouri Attorney General’s Office under Democrat Jay Nixon.

The issue, Hatfield said, stems from the company using legal hemp products in its products, which passed state testing before it was sold to consumers.

“Delta’s compliance officer at the Department knew about this process and Delta specifically asked if it should stop the process. She did not instruct them to stop,” he said, saying that internal documents show that the compliance officer told her supervisors that she believed the company’s process was legal.

“We are perplexed as to why they ignored her and are taking this action,” he said.

Missouri’s legal marijuana industry has been plagued by criticism and controversy, largely stemming from the fact that it’s been dominated by large companies that were already selling medical marijuana — leaving little room for small-time players to break in.

While the constitutional amendment that voters approved created a program designed to help smaller businesses and marginalized groups to enter the market, critics say its rollout has largely benefited those already in the industry.

An out-of-state company accused of predatory practices, for example, secured two licenses from the program and promptly listed them for sale, The Star reported this week. The state awarded another license to a company based in New Jersey.