Three companies that sold cannabis drops blamed for liver injuries will temporarily stop marketing their products in Colorado and pay a $400,000 fine, according to the attorney general’s office.
The companies — Nuka Enterprises, Nuka Properties and Sima Sciences — could sell their products in the state again at some point if they meet certain conditions, Colorado Attorney General Phil Weiser said. If they violate the terms of the agreement, the fine would increase to $1 million.
Weiser alleged the companies knew customers who took the Midnight Drops sleep aid, sold under the brand name 1906, had developed liver problems, but continued to send the product to stores for almost two years.
When confronted with the reported liver injuries in 2022, the companies reformulated the drops without confirming that the replacement herb would be safer, he said.
“Colorado’s cannabis regulations are the nationwide gold standard for protecting consumers, and the companies in this case broke the law by failing to disclose potential health risks from their products,” Weiser said in a news release. “With this action, I am holding the companies and one of its co-founders accountable to ensure they face consequences for their deceptive business practices.”
Nuka Properties owned the facility that made the drops, Sima Sciences held the licenses to operate in Colorado and Nuka Enterprises distributed the products, according to the settlement.
The companies and their co-founder, Peter Barsoom of New York City, denied breaking the law or misrepresenting the drops’ safety.
The agreement requires them to pay the fine in installments through December 2029. If they pay at least $150,000 by the end of 2026, don’t ship products to Colorado during the ban and agree not to claim their products have health benefits, they could return to the state’s market in January 2027.
Though the drops contained cannabis, the Marijuana Enforcement Division attributed the injuries to corydalis extract, a plant-based substance that some people use as a pain reliever or sedative. While relatively little research exists on corydalis’ benefits and risks, liver injuries are a known possibility.
The Marijuana Enforcement Division released a warning about the drops in July 2022, but didn’t stop the companies from selling a reformulated version with stephania extract, which also can be toxic to the liver.
The companies stopped producing the drops in May 2023 after reports that customers had developed elevated liver enzymes, but didn’t warn stores that previously purchased them to take the product off their shelves. Elevated enzymes are a sign of liver injury. Depending on how severe the injury is, the organ can sometimes repair itself.
Under the terms of the settlement, the companies also agreed to publish an apology attributed to Barsoom on 1906’s website and Instagram account.
“We’ve always believed that great products should improve people’s lives. When we learned that Midnight Drops wasn’t meeting that standard for everyone, we realized we had let our customers down. We are sorry that we didn’t act faster and communicate better with both our customers and regulators,” the apology said in part.
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