Industry: Cannabis & Hemp
Services: Cannabis and CBD testing, contract research, and consulting
Co-founder and CEO David Winternheimer, PhD, is stepping beyond cannabis testing to help companies rise from fledgling startups to mature businesses.
The 70,000-square-foot LA Cannaplex in Gardena, California, started with cannabis retail, distribution, grow, and manufacturing facilities. The missing piece of the supply chain was a cannabis testing lab, so the investor sought an entrepreneur who could develop and run a high-tech operation. Through a mutual colleague, he found Winterheimer to co-found Pacific Star Labs.
The lab started as a cannabis testing facility for analysis required by the California Bureau of Cannabis Control (BCC), and tests for levels of cannabinoids, terpenes, residual solvents, pesticides, heavy metals, microbials, and moisture. Currently, there are 33 BCC-licensed labs in California, about half in Northern California and half in the southern part of the state.
Winternheimer says he sought to differentiate Pacific Star Labs, noting, "What we're doing differently than other labs is offering what we're calling custom chemistry services, which is just another way of saying contract research. The idea is not to just provide the routine testing that everyone else does but provide services, so we can allow people to outsource or partially outsource some of their research and development needs in terms of product development, manufacturing process, or scale up with customized testing beyond what the state requires."
The contract research organization (CRO) model is popular in other mature industries. "It's something that the cannabis industry is new to because a lot of that work had previously been done on the black market," says Winternheimer. "There wasn't really such a scientific focus on how products are developed or tested or manufactured. And that's really what we want to bring -- a higher level of scientific expertise to the industry that can help advance the cannabis market into an industry like the pharmaceutical, biotech, or aerospace industries. Those are all obviously very mature industries that employ the CRO model very frequently in their research and development processes."
To that end, Pacific Star Labs offers product development support that includes ingredient and packaging qualification, product formulation, and custom testing for each unique product. The company's manufacturing process optimization services show how a company can scale from small to large production, develop in-process control monitoring, and create pre-packaging lot testing, as well as SOP development.The final product testing services include pre-compliance testing, California compliance testing, shelf-life assessment: simulated (accelerated) stability, and ambient condition stability.
In addition to the brand-new, top-of-line Shimadzu instrumentation, 80 percent of the Pacific Star Labs staff has bachelors' degrees in bioscience or chemistry and 20 percent also have PhDs in chemistry. "We actually work more from a business development and project management and strategy perspective," says Winternheimer. "We send our PhDs in to talk about the business problem and the chemistry problem. And that's not something that other labs are able to do. We have an excellent team of people experienced in cannabis and other industries, and we're also building a network of additional expert consultants from other industries that we can bring in on a project-by-project, hourly basis to provide advice about chemistry, expertise beyond what we have on our team."
He continues, "We take a very collaborative approach not only with our clients but with industry experts in other areas outside of cannabis that have been addressing these types of issues for decades. The cannabis industry has not been able to attract that type of talent because it is still illegal in some states. And, to be quite frank, those other industries pay a lot more money than cannabis does."
Challenges: "The challenge is not only helping companies solve their problems, but helping to teach them chemistry in the process, so that they can become more effective on their own with assessing some of these problems," says Winternheimer. "And, generally, just bridging the scientific gap between the industry and the field of chemistry."
Opportunities: "I think that the opportunity brought us to the conclusion that we wanted to apply the CRM, the contract research model, to the cannabis industry and, create a team and sophisticated lab that can be outsourced for their research and development needs because most of these companies are not employing internal R&D departments," says Winternheimer.
Needs: "PR and publicity to get the word out in an industry where people are bombarded with so much spam and so many different things," says Winternheimer. "How do we communicate to the industry how we're different, and we're just not the next compliance testing lab. But we're actually a team of scientists that can essentially be an extension of their own internal team -- being true collaborators and partners -- not just a customer-supplier relationship. What we're offering is not a commodity, and for the most part, the compliance testing market is a commodity. We need people to understand that differentiation."