California regulations and consumer habits emphasize the THC content of cannabis products. This has encouraged bad actors to manipulate lab results and sell their products at a higher price.
Most Californians can simply walk into their local, licensed cannabis dispensary and purchase a variety of products. Few consumers read each product’s label and make a decision on what to buy. Too often, they are actually in the dark about what they’re buying.
Research shows that a product’s price, THC percentage and a budtender’s recommendations are the primary things consumers look for. There has been a disproportionate focus on THC percentage – partly due to the inaccurate notion that potency is directly correlated with quality, and partly due to the lack of awareness about the important role of terpenes and other cannabinoids.
A knowledge gap is normal for new industries, but this is not the case in more mature substance markets like alcohol. Most people do not focus solely on the alcohol content when they buy a bottle of wine. Instead, they consider the varietal, the region, the flavor profile and, of course, the price.
Cannabis is not there yet, and it certainly doesn’t help that, in legal markets, regulators only require companies to disclose THC and CBD percentages on recreational and medicinal products. This inadvertently affirms the consumer belief that THC is king.
This focus on THC potency has incentivized cannabis businesses (brands, cultivators, distributors) to game the system, especially when the economics are challenging for legal operators. If consumers remain fixated on THC potency, some businesses are willing to deceive customers because they can charge more. High THC cannabis products sell for a higher price, which has encouraged bad-actor cannabis businesses to shop around for similarly bad-actor testing labs that are willing to use bad science or commit fraud to manipulate results. The industry refers to this practice as “lab shopping.”
Regulations typically require that the THC content on the label must be within a relative percent difference of the actual tested results. In California, that threshold is 10%, which allows certain labs to doctor results or brands to get creative with their label claims.
These shady practices have led to a systemic problem of potency inflation that is detrimental to everyone involved. Lab shopping has often allowed the worst brands and labs to perform better, while high-efficacy brands and science-first labs have suffered. This creates an unnecessary and unsafe cycle of misinformation where the customer is at risk. As a result, potency inflation has spread like wildfire because there has been little accountability for cheaters – so far.
Lawsuits have recently been filed in Arkansas and California, claiming that companies deceived customers about the THC content in their products. These suits may fail because they are not based on actual science, but they help shine a light on a problem that needs immediate attention.
Corners of the regulated cannabis market are now operating like an illicit one. California Attorney General Rob Bonta recently announced a one-year program to eradicate illegal cultivation, but the public needs enforcement on this issue, too. California legislators should institute regulations that support a system for validating lab results by requiring well-designed comparative studies and recalls when products fail. All cannabis testing results should be made public, too.
These measures would ensure transparency and safety for consumers, and provide consequences for businesses that cheat.
Consumers know the exact level of every vitamin in their food, the amount of alcohol in every drink, and the full caloric breakdown of a can of soda. Cannabis shouldn’t be different, but that’s not the reality today – even in our regulated market. That must change.