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Medical marijuana seed-to-sale tracking contract under protest

JEFFERSON CITY, Mo. — The contract award for Missouri’s seed-to-sale tracking software is under protest for the state’s budding medical marijuana program.

The company who came in second in the request for proposal process formally objected on Thursday to the contract being awarded to a competitor.

BioTrack, in their bid protest, is seeking to void the state’s contract with Metrc and have the contract on seed-to-sale tracking be re-bid or awarded to them based on the point system used.

BioTrack and Metrc are two of the top companies nationwide for seed-to-sale tracking, with nine and 11 states contracting their services, respectively. According to Marijuana Business Daily, Metrc won four of the seed-to-sale contracts awarded in 2018 while BioTrack won the other two.

Bid protests are common. This particular fight is three-pronged, with Missouri’s constitution playing a role along with the RFP requirements.   

“Acceptance of Metrc’s proposal would also conflict with Article XIV of the Missouri Constitution because it imposes unauthorized fees on licensees and limits their ability to use other commercially available tracking systems,” the protest states.

The voter-approved constitutional amendment establishing a framework for medical marijuana requires that the Missouri Department of Health and Senior Services certify two commercially available systems for tracking. The amendment also stipulates the department has no authority to apply or enforce any rule or regulation imposing any undue burden.

An integral part of Metrc’s tracking system is radio frequency identification (RFID) tags. The cost of the RFID tags is shouldered by the user, and was outside the cost bid in the RFP.

According to the protest, since Metrc’s system requires the use of their own proprietary RFID tags, it violates the constitutional provision requiring more than one system. The protest also notes with the user barring the cost of the RFID tag, it amounts to “additional licensure fees that would be required of industry participants that are not authorized by Article XIV.”

The cost of the tags is another point of contention by BioTrack. They allege the pricing was supposed to be “firm and fixed,” not variable.

“But Metrc’s pricing is variable because Metrc will charge licensees to purchase RFID tags from Metrc. Therefore, the cost depends on the number of plants, licensees, and cannabis inventory production,” states the protest.

The bid protest goes on to state, if the Office of Administration is not going to reject Metrc’s bid for going outside of the designated rules then every vendor should be given the opportunity to submit a proposal incorporating variable costs.

This is not the first time Metrc has been awarded a contract and their RFIP tags became the center of controversy. In 2017, the company withdrew their proposal in Washington State after the cannabis governing board declared it would not require the tags as part of the tracking system following tag fee complaints.