Monday, December 5, 2022

THC potency under scrutiny in leaked report

Welcome to my weekly newsletter on the cannabis and psychedelics industries. I have a special invitation to readers this week as we approach

Welcome to my weekly newsletter on the cannabis and psychedelics industries. I have a special invitation to readers this week as we approach the year's end and pass six months since I wrote about cashless ATMs: Dispensary owners, please reach out and tell me what's going on with your transaction technology these days. Still hoping for SAFE Banking? Meanwhile...

Potent problems

High-potency marijuana products, increasingly questioned for their ties to mental health risks for consumers, are creating new regulatory risks as well, according to a leaked report in Washington state last week.

The levels of THC in marijuana have skyrocketed in recent years, from around 4% to more than 15%, according to a report based on government-seized samples. Not only have marijuana plants been bred to contain more of the psychoactive substance, but an entire category of products known as concentrates are often labeled as having 60% to 99%. The cannabis industry says the products are important for medical users and aren't always labeled accurately. But there are growing concerns about people stumbling into them by accident — as well as the products' links to addiction and psychosis.

In Washington state, a scientific report to address the public health challenges of high-THC cannabis was supposed to be kept under wraps until around the end of this year. But last week, a draft was leaked by Cannabis Observer, a publication run by a marijuana advocacy group that includes activists, industry professionals and journalists. It posted excerpts in an online article.

The big reveal? The report recommends policies such as preventing new consumers from starting with such products and calls on companies to give consumers more information. According to the excerpts, the report doesn't recommend a cap on THC levels, though it suggests that could be more feasible in the future.

"It was legalized as a plant, and now it has become something else. So now there's a burden of proof," said Beatriz Carlini, who directs cannabis research and education at the University of Washington's Addictions, Drug & Alcohol Institute. Carlini, who worked on the report, said that there is "robust" science showing that higher-THC marijuana increases the risk of addiction and psychiatric disorders. As with other drugs — even recreational ones — there's a burden of proof on the companies to show that their products are safe that has yet to be met.

She said the report will recommend tax increases on any product with more than 35% THC and the prohibition of any advertising and promotion of such products. It will also call for increasing the age requirement for their purchase to 25. Carlini said the study also strongly recommends that limits on THC content be defined "in the very early stages of legalization."

One of the study's more interesting findings was the perception gap when it comes to these high-potency products. When asked to rate how concerned they were about the risks of high THC concentrations on a scale of 1 to 5, responses from scientific researchers, government employees, health-care providers and prevention agencies (such as those that seek to prevent substance use or mental-health problems) ranged from 3.8 to 4.2. Marijuana industry representatives, however, only ranked their concern level at 1.4, while cannabis consumers were double that at 2.8, according to Carlini.

The decision on what to do with the information is ultimately up to legislators, but it's a sign that the issue — and discrepancies over how it's perceived — isn't going away any time soon.

Number of the week

$64 billion
The projected size of Europe's cannabis market by 2032, according to a recently released white paper, European Cannabis: The making of an industry

Quote of the week

"A marijuana-related business could be laundering proceeds from fentanyl sales on the side, or from marijuana sales conducted outside of the state regulatory frameworks," the US Justice Department said in a leaked memo about concerns over how the language of the SAFE Banking Act could complicate prosecution of illegal activities.

What you need to know

  • The Justice Department has concerns about the impact that marijuana banking legislation could have on law enforcement investigations, Punchbowl reported, citing a memo. Marijuana stocks slid on the report.
  • The youngest US consumers are trending toward weed over booze, reshaping the alcohol industry, according to a study from Cowen.
  • Uruguay has struggled to build a medical marijuana export industry, and backers of a multimillion-dollar cannabis extraction lab see an opportunity to turn the country into a global supplier of pharmaceutical ingredients.
  • About 40% of cannabis products purchased from 20 illicit stores in New York City were found to contain harmful contaminants such as E. coli, lead and salmonella, according to a report commissioned by the New York Medical Cannabis Industry Association.
  • Rhode Island launched sales of recreational marijuana Dec. 1 after legalizing cannabis earlier this year.
  • Tilray Brands, Aphria and other entities entered into an amended and restated credit agreement expiring in 2025.
  • The former chief executive officer of a high-flying technology startup who was fired for using LSD sued the company and some of its venture backers, claiming the real reason for his termination was his East Asian background.

Events

Saturday 12/10

  • The Emerald Cup Harvest Ball, for California's cultivators and growers,  through Dec. 11, in Santa Rosa, California. 

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