Colorado Shuts Down Three Cannabis Companies After Investigation Finds Products Could Harm Liver

Three cannabis companies will cease operations in Colorado as part of a
settlement with state Attorney General Phil Weiser following an
investigation that found the companies failed to disclose health risks
associated with the products to consumers and misrepresented the products’
health benefits.

Under the settlement with the manufacturers and distributors of the 1906
brand of cannabis products – Nuka Enterprises LLC, Sima Sciences LLC, and
Nuka Properties LLC, along with their co-founder, Peter Barsoom – the
companies will shut down and pay $400,000 in fines to the state. The
companies may be allowed to resume operations in the state if certain
conditions are met. If the companies violate the terms of the settlement,
however, they will be required to pay another $600,000.

According to the attorney general’s office, from 2016 to 2024, Sima
Sciences sold edibles called “Drops” in Colorado, but, beginning in 2020,
the company started to receive complaints about a product called “Midnight
Drops,” which were marketed as a sleep aid, and some customers said were
causing liver problems. In 2023, state regulators issued a warning about Midnight
Drops products manufactured prior to March 2022 that contained Corydalis
rhizome extract. The notice said that the extract “could be connected
with liver injury but the exact cause remains unknown.”

The attorney general’s office’s investigation found that Sima was aware the
products might be causing health problems for consumers as early as 2020
but continued to manufacture and distribute them. Investigators also
learned the companies did not perform adequate research on Corydalis
and Stephania – another extract used in the products – and failed
to properly notify retailers of the problems so the products could be
removed from shelves.