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Tilray says it halted its bid after Health Canada subsequently issued a list of alternative fungicides that the company now uses.Fred Lum/The Globe and Mail

One of Canada's largest medical marijuana producers, which raised concerns with Health Canada over harmful chemicals found in cannabis sold at Vancouver dispensaries, sought permission to use a controversial fungicide on its own crops last year, but says it later abandoned the idea.

According to the British Columbia Lobbyists Registry, Tilray asked for British Columbia's support in getting federal approval to use Nova 40W, a fungicide that contains myclobutanil – a chemical effective at controlling crop diseases, but one that has been at the centre of controversy. It is banned by several U.S. states for use on cannabis because of concerns it emits hydrogen cyanide when heated.

Tilray said it sought to use the product in the belief that it was being employed by non-licensed marijuana grow operations to control a fungal disease known as powdery mildew. The company didn't say how it knew the product was being used by those operations, but Tilray spokesman Zack Hutson said the bid was halted after Health Canada subsequently issued a list of alternative fungicides that the company now uses.

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"Tilray contacted the B.C. government on March 19, 2015, to inquire about the process for initiating an application to obtain approval for the use of Nova 40W on cannabis," Mr. Hutson said in a statement Wednesday. "We stopped lobbying on the issue a few weeks later, after we found existing Health Canada-approved organic solutions that have already undergone [federal testing]."

The revelation is one of several events in recent months that illustrate the need for scrutiny of the burgeoning big-money cannabis industry, as the government intends to legalize the drug for recreational use next year, to ensure consumers are protected from harmful chemicals, bacteria and other contaminants.

In July, The Globe published the results of an investigation that discovered one-third of nine cannabis samples obtained from Toronto storefront dispensaries, which operate with no federal oversight, contained potentially harmful bacteria that could have serious effects on elderly patients or those with compromised immunity. One sample contained mould that can lead to serious lung conditions in patients.

Last week, documents obtained through the Access to Information Act showed Health Canada was warned nearly a year ago about harmful chemicals showing up in marijuana sold at storefront dispensaries in Vancouver. Lab results submitted to Health Minister Jane Philpott's office showed 13 of 22 samples tested showed high levels of carbamate, which is not approved for cannabis, or dodemorph, a chemical that is not approved for human consumption. Health Canada later revealed those test results were submitted by Tilray.

Despite evidence of a potential public health threat, Health Canada did not act on the warnings, nor inform local authorities in Vancouver. Health Canada said it considers dispensaries to be illegal, and therefore not its responsibility. However, those same dispensaries have flourished across Canada this year as a direct result of the federal government's announcement that it will legalize the drug. Ottawa has not addressed their growth, saying it is up to local police to address the issue.

After initially telling The Globe that she couldn't recall if she'd seen the documents, the Health Minister issued a statement on Friday confirming the results were sent to her office. Tilray then called on the government to act: "We are disappointed and concerned that nearly a year after sharing these results, patients continue to be at risk. If dispensaries are going to be permitted to continue to operate, then they should be held to the same standards as licensed producers."

It is unlikely Tilray would have received federal approval to use Nova 40W if it had proceeded with the request. Such requests must be submitted by the manufacturer of the chemical, Dow AgroSciences, and tests must be conducted to ensure it can be used safely on a particular crop, which takes up to two years.

Nova 40W is similar to Eagle 20, which sparked controversy in the United States when it was discovered to be widely used on cannabis. Both contain myclobutanil, which is approved in small doses for some crops that are eaten, such as berries, since it is metabolized by the digestive system. However, it is thought to be potentially dangerous on products that are consumed in other ways. Lawmakers in Colorado, Washington and Oregon, which have legalized cannabis for medical or recreational use, moved quickly to ban the use of myclobutanil as a result.

In Canada, there are questions as to how much scrutiny is being exercised in this new industry. Health Canada says myclobutanil is not permitted, but The Globe's investigation found that not all labs enlisted to test cannabis bother to check for the chemical, or are calibrated to detect its presence, indicating a blind spot in the safety testing regime. Though dispensaries are not held to any federal standards, Health Canada said if a licensed medical marijuana producer were found to be using such chemicals, it would take action.

"Chemicals such as myclobutanil or dodemorph are not authorized for use by licensed producers. If the Department had reason to believe that a licensed producer was using unauthorized pesticides or other chemicals, it would take immediate enforcement action," Health Canada said. Such steps "could include detention of product, recalls, or potentially revoking the producer's licence."

The B.C. Lobbyists Registry indicates Tilray's request is active, which Mr. Hutson said is a mistake. The company has lobbied the B.C. government on other subjects related to the industry in recent months, and those meetings have been erroneously linked to the same file on the registry, he said, adding the company is now trying to have the record corrected. However, a spokeswoman for the registry said companies can't have information changed retroactively, even if mistakes are made.