TruTrace Technologies is the developer of StrainSecure™, a fully integrated software platform, secured on a blockchain infrastructure, that gives clients in the Cannabis supply chain the ability to store, manage, share and access quality assurance and testing results, as well as motion and movement intelligence on inventory from batches and lots to serialized items. I spoke to CEO Robert Glazara to learn about how this technology works and the advantages it offers to medical Cannabis suppliers.
Please tell us your company’s story: How did it start and how has it evolved so far?
Personally, I fell in love with technology development around 2012. It was around this time that I met my business partner, Tommy Stephenson, who came from a deep background in digital design and development and was running an award-winning software agency in Seattle. Together we realized we possessed a huge breadth of experience building enterprise technology in a legally-compliant way and decided to embark into a couple of different areas of independent product development.
Around the same time, the agency was brought in to work on an exciting project for a company named Ghost Group, whose flagship product was Weedmaps.com. Our team came in as the agency to help reconfigure their technology infrastructure in 2014. Tommy served as their CTO for 18 months and did a great job with that company, but we didn’t own any equity. Although we knew that their long-term success would be amazing for them, we wanted to build something of our own. Nevertheless, the experience was invaluable as it taught us about all the potential issues and pitfalls that could befall this new emerging industry and marketplace.
In 2016, we began building a software platform for the Global freight and logistics space and were excited about how this system could be extended into cannabis. However, we knew we wouldn’t dive into the cannabis industry fully in the US because of federal prohibition, so we began exploring opportunities with our partners up north. Looking to Canada, we discovered that they had begun implementing an entire legal framework for medical Cannabis starting in 2013. We were excited that the infrastructure in this country was laid out, and in 2018 we spun up TruTrace, which licensed our core platform, and began building new systems specifically for the cannabis industry.
Around the same time, we were seeing an incredible boom in the industry as recreational Cannabis became legalized in Canada, followed by a short market explosion, and subsequent decompression, as well as a series of changes over the course of 2 years.
However, even with all of these changes we began learning consistently across the board that product-related data is incredibly important to the medical industry at large. It was critical to truly identify the data associated with each Cannabis product, including the detailed chemical makeup and molecular structure of each organism.
You see, Cannabis is a heterozygous plant. Similar to humans, its offsprings are similar to one another, but not directly the same. The only way to replicate a heterozygous organism, in this case, a plant, is to go through the cloning propagation process, which is the typical strategy in cannabis farming. You grow the plant and then you clone it over and over again, and that’s how you continue reproducing the same strain.
Genetics play an interesting role in that you have consistent, continual epigenetic changes that occur on the plant, including those impacted by environmental conditions. Therefore, we know that every batch of product is potentially a little bit different from the previous batch, and it was those variabilities that we began focusing on.
TruTrace provides detailed tracking of variabilities between batches and lots in order to better understand how a particular batch might affect a patient, and what caused that change. We want to know whether there was, for example, a reduction in CBD, or an increase in a particular terpene. We knew that the only way to do that was to build a better data structure for the industry and that’s the background of how we built our business and deployed it to market.
What kind of clients do you typically work with?
We work with Cannabis cultivators and manufacturers who are looking to showcase the quality of their work at a higher level and show their clients that they can trust their products through third-party validation and blockchain secured data on every single batch and lot produced.
We also found that oftentimes, medical distributors like Shoppers Drug Mart in Canada are aggregating products from a multitude of different manufacturers, so they want a similar system to manage inventory data coming from different players, in order to start communicating exactly what those differentiations are to each patient.
Our sweet spot is between the medical distributors and those manufacturers that want to take their quality to the next level and rise above their competitors.
How do you address the gap between the medical cannabis market and the recreational one?
The US and Canada have gone a little more in the recreational route, which I think is unfortunate for patients; however we are seeing incredible traction in Europe, Australia, and other parts of the world that are truly looking at Cannabis as medicine. As such, there are reliable standards and Good Manufacturing Practices that need to be followed and adhered to, and systems like ours help operators manage production data within these standards. This assurance is highly valued in the medical markets and less so in the recreational market due to the lack of standards and very little tracking of granular product data.
It’s a challenge because, in the pharmaceutical and medical industries at large, they use an infrastructure which is built upon molecular science rather than organic chemistry. Pharmaceutical companies patent very specific formulations and take steps to protect those formulations. The API or active pharmaceutical ingredients may vary slightly but the variabilities in the finished product are often very slight.
Those in pharma are used to standardization and critical data analysis practices, whereas the recreational cannabis industry is much more obscure and mainly focused on the user experience. In most cases, products are distinguished as either Sativa or Indica or even worse, simply branded with a street name like Ghost Train Haze or Bubba Kush, which means absolutely nothing to the medical industry.
On the recreational side, it’s all about the experience and the branding of the strain whereas, in medicine, it all boils down to product data, and this is one common thing we heard from doctors across the board.
Although everyone is starting to see the very positive therapeutic effects of Cannabis, we must remember that it’s still a psychoactive narcotic and as such, it’s not necessarily for everyone. The other thing that people are concerned about, especially in senior care, is pain management. We’ve seen that Cannabis can definitely get people off opioids and on to a more traditional holistic medicine, which is amazing. The caveat is that this particular market also takes on a lot of other pharmaceutical drugs such as MAO inhibitors or blood pressure medications.
Not knowing the contraindication of Cannabis on those particular treatment options, because no studies have been done, is a real problem. This makes it much harder for doctors to prescribe medical cannabis to their patients. They might believe strongly in the medical impact of Cannabis, but if their patient is on multiple other medications, and they don’t know how it’s going to interact with each of those particular drugs, recommending Cannabis becomes a tough decision. The only way to get past this is through data analysis and research.
Recreational Cannabis is also fighting the black market, which is a whole different rabbit hole with a myriad of challenges. As for medical Cannabis, I personally think that it should come with no taxation. If the States or countries that are setting up the regime to help give people medicine take an excise tax of 25%, that treatment plan becomes unaffordable for many of the patients who need it, which in turn either leaves them untreated or back towards the recreational or worse black markets for the product.
With all this being said, I look forward to seeing Europe and even countries like Israel set the standard for the medical industry long term as we’d like to see Cannabis being treated as true medicine.
What is the role of blockchain in all this?
As a technology company, our entire team got interested in blockchain very early. We were intrigued to see what changes it could make in the marketplace. The robustness of blockchain comes down to the ability to secure global transactions rapidly and securely. Whether it’s a transfer of assets, money, inventory, or in our case, the notarization of certain key milestones along the supply chain that assures quality.
This would include data about when and how the product was tested, and what the results were. What is the intellectual property profile? Who owns the strain? Essentially, it becomes a record that exists immutably in time.
In the case of Cannabis, ideally, this record would start with the mother cultivars. We first register them into the blockchain in a digitally secure manner, and then operators can build inventory directly off of that baseline record. As you’re cloning and building your finished product, you have the traceability chain between the original cultivar and the finished product, which could be seven steps down the line, in addition to identifying the “brothers and sisters” that have come off of a particular product line. To us, that is where blockchain becomes really important, as it gives you rapid access to information, and ensures that the integrity of it cannot be compromised in any way.
Similarly, we’ve also been talking to several groups that are looking to build marketplaces for the industry, which is tremendously exciting. However, the challenge within the global wholesale market has always been about building trust between vendors in different countries. We believe blockchain can serve as a really good mechanism for building that trust, as it allows full transparency and accountability for each transaction
When we first built our system we also explored the registration of genetic codes and successfully secured a library of intellectual property for a couple of clients. Their genetic code is actively anchored to the blockchain through our system. Practically, what that means is that each cultivar has a digital identity. If at any time you want to come back and test against that identity, you can do so because you have the baseline record to be able to test against, as well as to see how and if it was crossbred and whose intellectual property it is. That’s just an example of the power that data systems like ours can offer in markets where it’s deemed important
How do you envision The future of the cannabis industry?
Unfortunately, I believe Canada and the US have taken a few wrong steps in the early stages of their development which could be delaying legalization. The Canadian marketplace grew very fast and with so much ambition, but the reality is that it’s still a relatively smaller market. That said, I still think they have some of the more sophisticated operations in the industry. I believe that for those companies to be successful globally and get their product moving between countries, we have to create some set of standards and practices.
I think this is the biggest hurdle that multi-state operators in the US, as well as operators in Columbia, Canada and beyond are going to face. The challenges of exporting products is something that very few have been tackling, at least not to the extent that we see in other industries.
We’re witnessing significant supply chain issues right now in the US, even for products that are coming from Mexico. Products are put on a container ship in Mexico, taken up the coast, which is a one-and-a-half-hour sail, and then sit there for ten to fifteen days before they are delivered at the port.
These are the kind of things that the cannabis industry hasn’t even tried to tackle yet because they haven’t been in the bigger supply chain framework. I think those are the things that smart, forward-thinking leaders in the industry will need to tackle. We need to look at this as an international interest and set the roadmap between the EU, Australia, Canada, Columbia, potentially the US if it were to move in that direction, as well as South Africa and other places.
What is the archaic standard that market players can all operate by to be able to move Cannabis products between countries?
It makes sense for a particular area to provide the right kind of medicine to patients and recreational consumers who care about product quality. From an altruistic perspective, I’d like to see the medical cannabis industry given a little more respect in this marketplace. If we can achieve a level of standardization for patients, then I believe the recreational segment will fall in line with that as well.
The US has always been a divided country. I think the idea of completely legalizing something that certain states don’t even want in their borders is not likely. Even if they tried to legalize it across the board, I don’t even think it would hold up in court because the matter of state rights would likely become an issue.
I think the right path for the industry to take, even in the US, is treating Cannabis as medicine first and foremost. If we can get some framework of standards and practices in place that everybody can implement successfully by following the protocols, we can work with partners all around the world. We see this in every other industry. Organizations and industries are coming together to create standards and practices collectively.
The Cannabis industry is still fragmented because it’s young. The future must be built on standardization that gives companies the ability to operate in multiple jurisdictions. Hopefully, we’ll see that unfold in the next few years.
any final last words, anything you want to highlight?
I believe there is a significant group of operators in the market that understand the value of their intellectual property. I think it’s critically important for solution providers like ourselves or any others to be able to look at that IP storyline because that’s where the race is going to be won.
The moment you have a particular intellectual property or a particular strain that can go into real evidence studies and get efficacy results on particular conditions, that particular IP becomes a golden ticket for the company that owns it.
If they don’t own it, and they don’t have any record of that ownership and the product gets out, it can easily be crossbred by other cultivators, denying the original creator of any reward. Truly, the identification of what a particular IP does for a patient will be a game-changer for the industry.
We are seeing the same thing happening in psychedelics. Psilocybin is showing significant effects of PTSD in early research, and it can be more standardized. Similarly, if we could see and track that from a medical perspective, I think it would really help the industry. I’m a strong believer in IP and a strong believer in medicine and providing patients with consistency.
Plant medicine will never be exactly like pharmaceuticals. Like many other plant medicines, there are variabilities. We have to understand and respect that, but it doesn’t mean we can’t become better at managing the information associated with those variabilities. To me, that is going to be where the game changes for the industry.