Arizona marijuana regulators flag major testing lab for multiple violations

A prominent national marijuana testing lab is in hot water with state regulators in Arizona who last month found fault with the lab’s ability to detect contaminants and flag hemp-derived THC, public records show.

Following annual inspections in March, the Arizona Department of Health Services on April 24 informed Kaycha Labs, which holds licenses to test cannabis in seven states, of more than a dozen alleged “deficiencies,” including problems with the lab’s potency testing and pesticide and microbial detection methods.

It’s the latest example of regulators taking action against a cannabis testing lab for potential failures to detect contaminants and produce reliable potency results after years of complaints of questionable lab results from across the industry.

Regulators in California last month suspended at least two labs’ permits to operate, the latest in a crackdown that began last year.

And it comes amid claims from operators in states such as Colorado and New York that unscrupulous parties are introducing hemp-derived THC oil produced outside regulated channels into the legal cannabis supply chain, an example of the practice known as “inversion.”

Kaycha, which claims on its website to be the “largest Multi-State operator” in cannabis testing, may face separate, as-yet unknown “civil monetary penalties” for the alleged violations in Arizona.

That’s according to the April 24 notice signed by Mary Graham, who leads the Arizona Bureau of State Laboratory Services’s certification and licensing office.

And this is at least the third time Arizona regulators have found fault with Kaycha.

Several alleged violations noted by the Department of Health Services (DHS) in its April 24 “report of findings” were “double repeat findings” also cited by the agency during inspections in 2023 and 2024, as per Graham’s notice.

DHS’s notice gives Kaycha 30 days to respond.

The company did not respond to requests for comment from MJBizDaily on Thursday and Friday.

Reached via phone on Thursday, Graham directed inquiries to a DHS spokesperson.

DHS did not provide comment prior to publication.

The lab appeared to remain in operation as of Friday. There have been no public notices of product recalls.

Nor was it immediately clear how much product currently for sale on Arizona marijuana store shelves is potentially affected.

According to Graham’s notice, Arizona DHS found that Kaycha:

In an interview, Josh Swider, the co-founder of San Diego-based Infinite Chemical Analysis Labs and a frequent critic of allegedly nefarious labs, called the allegations “extremely concerning for public health.”

They also raise questions about the safety of cannabis tested in Arizona and in other states, he said.

“It concerns me that this is a multistate operator,” he added. “With the mistakes being done at this laboratory, it would bring into question every other laboratory run by this company.”

Arizona regulators have taken action against allegedly unscrupulous labs before.

In 2022, the state fined OnPoint Labs nearly $500,000 for allegedly deliberate actions that threatened public safety.

State records indicate that Kaycha is one of 11 testing labs licensed in Arizona to test cannabis for sale.

In a telephone interview on Thursday, Demetri Downing, the founder and CEO of MITA, an Arizona cannabis industry trade association, noted that unlike retail and cultivation permits, which are capped by state law, the number of available lab permits is uncapped.

That results in a “very competitive situation, where the labs have to fight” for customers, he said.

“So then you have a situation where people get kickbacks, people get false reports, people have friends start a lab and get them favorable results,” he added. “These things have happened in the Arizona market.”

This is a state of affairs that even Kaycha has admitted to.

In a 2022 blog post on the company website, the company emphasized the need to “bring blatant testing corruption to an end.”

“But without holding cannabis firms accountable for their products, the market suffers further deterioration and becomes a cesspool of bad behavior,” the post reads.

Chris Roberts can be reached at chris.roberts@mjbizdaily.com.