Authorities are investigating accusations made by a former employee that a Minnesota-based medical marijuana company illegally transported cannabis oil out of the state.
The former employee said that at least $500,000 worth of cannabis oil was sent from Minnesota Medical Solutions’ Otsego growing facility to its parent company’s New York location to meet that state’s production deadline, according to a search warrant filed May 26 in Hennepin County.
“We are confident the claims relied upon by regulatory authorities to begin the investigation will be found to be false,” the parent company, Vireo, said in a statement.
According to the warrant:
The former employee, who had been involved in cultivation and production, showed state Department of Health officials an image of an inventory transfer from the Otsego growing facility to the Minneapolis dispensary. The cannabis oil at the dispensary “would be useless” because that location only sells capsules and vaporizer cartridges.
The employee said that they were sent to a New York facility in December 2015 to oversee cultivation of medical marijuana plants. Some of the plants there were not producing and could cause the company to “fall short of the production deadline” set by the state.
Back in Minnesota, the employee met with the chief operating officer, chief medical officer (CMO) and a horticulturist. The employee was asked to point out jars of cannabis oil that would “rescue New York.”
The employee said the CMO volunteered to drive the cannabis oils to New York in the company’s armored vehicle and “make the inventory disappear.”
Health officials audited and inspected MinnMed’s Otsego facility and the Minneapolis dispensary in May. They found a missing inventory page that contained transfer records out of Otsego dated Dec. 16.
Officers with the state Bureau of Criminal Apprehension searched the dispensary and the company’s armored vehicle. BCA officials saw that the CMO made several transfers in December — mostly after hours — totaling more than 5,580 grams of cannabis oil out of Otsego with no destination listed. Health officials could not laccount for the missing oil and learned that after-hours transfers are “out of the ordinary.”
The company responded to the search warrant by releasing a two-page statement saying the missing cannabis oil was destroyed and that the New York facility was not short on inventory. The company said the discrepancies stem from software designed for the accounting of marijuana plant material, not oil. Those limitations result in a lack of destinations for dozens of entries into the system, “not just the small number of entries cherry-picked by the disgruntled former employee.”
Health Department spokesman Michael Schommer said the investigation does not relate to the safety of any medication.