In Washington, like in many states this spring, there was a buzz building about a new way to catch a buzz: a new set of cannabinoid products developed from sources outside the state’s mature and well-regulated system.
Instead of traditional CBD, THC and other cannabinoids, these were molecules created in laboratories using a catalyst to chemically alter the cannabinoids found in less regulated, federally legal hemp plants, plants with a naturally occurring THC level of less than 0.3%.
But unlike most hemp-based products, they were still getting people high. And they were doing so without necessarily using any plant material produced by state-licensed growers. These THC isomers — alternate, rearranged versions of the delta-9 THC molecule most often associated with marijuana — include delta-8 THC, delta-10 THC, THC acetate (often referred to as THC-O) and even a delta-9 THC produced from CBD.
The influx of new cannabinoids prompted action from a nonprofit group that represents more than 60 of Washington’s outdoor and smaller indoor cultivators, the Washington Sun and Craft Growers Association, which in April filed a complaint with the state attorney general’s office regarding the sale of these cannabinoids to the public without disclosure about what they were consuming. The group raises questions about the safety and efficacy of the process that create the molecules, as well as about how these more recently developed cannabinoids interact with the human body. And, of course, the WSCA is worried about the economic hit it could lay on farmers who have invested in state licenses and sell plant material to processors.
“We have a lot of concerns about these chemically synthesized cannabinoids like delta-8 and delta-9 they are getting from chemically converting CBD,” says WSCA executive director Crystal Oliver. “Once we place our market in this trajectory where we are focusing on creating synthetic conversions … we’re going to see chemists continually innovating to try and come up with the strongest, cheapest cannabinoid. Over time that’s not going to be a plant-based economy at all.”
The complaint led the Washington State Liquor and Cannabis Board to issue multiple policy statements and enforcement bulletins regarding the illegality of delta-8 (noting it is a “controlled substance” as provided by state law) and other chemically synthesized cannabinoids in the state and within the regulated system.
But, of course, not everyone shares Oliver’s concerns, including other statewide industry associations. Some see the chemically synthesized molecules as the natural next step for the industry.
“Innovation can be disruptive,” says Kent Haehl, chief operating officer of clēēn:tech, a Washington-based company that licenses the process and equipment to make delta-9 THC out of CBD isolate. “Especially if you’re not the one innovating.”
A $10 million loophole
Since bursting onto the scene seemingly out of nowhere in the past few years, the issue of THC isomers created from hemp has spread across the country. Delta-8 products, in particular, are being sold in shops as diverse as gas stations and convenience stores, CBD shops and rec-legal dispensaries with promises of providing a legal high similar to that of marijuana, despite the legality of such being something of a gray area at the moment. Delta-8 sales are also booming online.
Chemically speaking, an isomer is a molecule made up of the same number of atoms, but arranged in a different order. Among cannabinoids, the known isomers include delta-8 and delta-10, among others. It’s a growing product category that analysts at New Frontier Data estimated at a $10 million market in 2020, though they admit it is difficult to track. Despite delta-8’s questionable legality, New Frontier’s analysis shows that demand for the products, often marketed as “marijuana light,” is increasing, especially in states that don’t have legal cannabis programs.
The differing state approaches mirror some of the confusion over the molecules themselves, how they are made and if, technically, they are “hemp” or “marijuana” products.
The question arises due to the 2018 Farm Bill, which legalized hemp and its derivatives and defines “hemp” as Cannabis sativa plants with a delta-9 THC concentration of not more than 0.3% on a dry weight basis. The DEA’s interim final rule regarding hemp adopted the same definition as the Farm Bill.
Many have read the laws to indicate that the DEA only considers delta-9 THC as “THC” and that the section allowing other forms of the molecule derived from hemp-sourced CBD as allowing all other forms, including delta-8 or delta-10. Several of the molecules occur naturally in the plant, but in very small quantities.
“In the naturally occurring cannabinoids, you can either have those cannabinoids extracted from plant material unchanged, or you can have those same cannabinoids that are produced by chemical synthesis or some type of conversion,” says Brad Douglass, a trained chemist and vice president of regulatory affairs for the Werc Shop, a scientific consulting firm focused on cannabis. “From a chemist’s perspective, as long as you have the same molecules, it’s immaterial where that comes from or how it got there.”
Douglass was among the scientists who took part in the WSLCB’s deliberative dialogues with scientists and stakeholders this summer, which included questions about the nature and safety of the molecules and featured in-depth discussions on their structures, the processes used to create them, potential byproducts and even the difference between “natural” and “synthetic” cannabinoids. He was also part of the working group in Oregon that is aiding the Oregon Liquor and Cannabis Commission in regulating these types of cannabinoids.
Regulation crashes the market
Oregon and Washington are just two of the states looking into these cannabinoids. Just this year alone, 16 states have declared the products illegal, while another five have added the controversial molecules to their state-legal programs. Meanwhile, other states, such as Texas, have either specifically voted down attempts to ban or regulate, or simply allow for the sale of these products.
In Connecticut, for example, the state’s recently passed legislation specifically includes delta-8 and delta-10 as part of its program.
A lot of these products “that are, for all intents and purposes, cannabis,” were being sold in a completely unregulated market, says Kaitlyn Krasselt, communications director for the Connecticut Department of Consumer Protection.
Krasselt says that as state regulators were crafting regulations, they became aware of these products popping up in the marketplace and decided that due to the THC content — of any isomer — they had to be brought under the regulatory market, though they are legal for use if they meet the state’s testing standards.
“If we’re going to regulate cannabis and what we traditionally think of as cannabis, we should regulate all products containing THC,” she says.
The regulations are having an effect on the market as well.
According to New Frontier Data, the main push behind these cannabinoids is a glut of hemp biomass cultivated for CBD, and excess CBD extract, the supply of which far outpaces the demand.
However, despite increasing demand for delta-8 products, New Frontier’s research shows that this spring’s rash of legislation and regulation caused prices for wholesale delta-8 isolate to drop 45% since August 2020.
According to New Frontier, the average per-kilogram price of delta-8 rose 4% in May, reaching a height of $1,227.15. The next month, however, prices began trending downward, falling 1% to $1,215. In July, prices fell further, by a whopping 12%, down to $1,069.20. In August, prices dropped another 5%, to $1,015.74. New Frontier Data predicts the price to fall below $1,000 this fall.
On top of that, on September 14, the Centers for Disease Control and Prevention and the Food and Drug Administration both weighed in with a public health alert and a consumer update, respectively, further chilling the market for delta-8 and other chemically derived cannabinoids. Both releases warned of increasing instances of both children and adults having “adverse effects” due to the misunderstanding and/or mislabeling of these products.
“I don’t think the future of delta-8 is very bright,” says New Frontier Data senior analyst Eric Singular.
According to the Food and Drug Administration release, which restated that the agency has not evaluated or approved delta-8 THC as an ingredient, national poison control centers received 661 exposure cases of delta-8 THC products between January 2018 and July 31, 2021, 660 of which occurred this year. Of the 661 exposure cases:
– 41% involved unintentional exposure to delta-8 THC and 77% of these unintentional exposures affected pediatric patients less than 18 years of age;
– 39% involved pediatric patients less than 18 years of age; and
-18% required hospitalizations, including children who required intensive care unit admission following exposure to these products.
But in some regulated markets, there may be a future.
In Washington, Douglass says he believes the chemically synthesized cannabinoids should be legal, but regulated like any others as part of a state’s cannabis system to ensure they are safe and clean of heavy metals, pesticides and other potentially dangerous components.
Douglass’s position is not unusual among scientists and other cannabis professionals, many of whom see the introduction of these molecules as innovation and evolution within the industry.
“It’s all the same plant,” says Lev Spivak-Birndorf, chief scientific officer of PSI Labs in Ann Arbor, Michigan, noting the “artificial distinction” between marijuana and hemp. “It’s really not that different to consume delta-8 versus delta-9.”
But while Spivak-Birndorf says he doesn’t have a problem with these cannabinoids being used as ingredients in other cannabis products, or sold on their own, he says they must be tested to determine if they are safe. At his lab in Michigan, he says tests on delta-8 products show “quite a bit of variability” as to ingredients
“None of it is bad or wrong, it’s just a matter of if it’s tested for safety,” he says. “As a lab scientist and a tester, clearly there are potentially harmful threats that could come about from these processes and without having any regulation in place to control them, that risk clearly magnifies.”
The results he sees often remind him of the early days of vape cartridges, which were often untested and sometimes contained a dangerous level of pesticides, metals or other chemicals.
At the national level, the National Cannabis Industry Association shares the view, taking the position that these intoxicating cannabinoids should simply be treated like delta-9 and regulated. NCIA spokesman Morgan Fox says he has seen tests on delta-8 products that come back with up to 25% “unknown” chemicals, which could be dangerous, like the acids often used as catalysts in the production of these molecules.
“Sort of like growing cannabis itself, processing CBD into delta-8 is relatively easy to do, but difficult to do well,” Fox says, noting there would probably not be a market for these products if cannabis were legal federally. “But there are going to be innovations happening where people are developing new cannabinoids and those need to be regulated.”
Back in Washington
Back in Washington state, where all parties expect the Legislature to address this in the next session, executives at clēēn:tech see it as nothing more than innovation. They say they are simply helping the cannabis industry get to the next step through cheaper ingredients. As owners and licensees of a process that makes delta-9 THC from CBD isolate — the same delta-9 THC that is naturally found in cannabis, they say — they disagree with the WSLCB’s determination that their product should not be allowed to be used in the state’s regulated system.
“We’re using cannabis hemp instead of cannabis marijuana,” says Marcus Charles, the company’s president.
Charles and Haehl insist clēēn:tech’s process and technology are safe, and offer lab test results that confirm it, though they are clear that they do not vouch for all processes. The pair says their business, which will work with any licensed processor in any legal state, can work to lower the price point for products and help get new markets off the ground. By bringing in CBD isolate sourced from hemp, the clēēn:tech process can help emerging markets get past the early stages where there is rarely enough plant material to meet the demand for both flower and for the production of edibles and concentrates.
“We can help emerging states achieve a level of scale,” Haehl says.
Douglass uses the analogy of the chemically derived cannabinoids being like caffeine or citric acid, two common ingredients in food items. While both of those ingredients are naturally occurring, the vast majority of what is found in stores is synthesized in laboratories. It’s the same molecules, just manufactured instead of harvested.
Washington CannaBusiness Association spokesman Aaron Pickus, whose organization supports the use of chemically derived cannabinoids as long as they are brought into the regulated system and tested for safety, agrees with Douglass and says these cannabinoids are simply going to be part of the discussion for the industry’s future.
“When we see the innovations of pretty established technology, like conversion that is being used in food processing, now being applied in the cannabis sector and legal in other states, we want to make sure that Washington businesses — if they choose — have the options to take advantage of this innovation or any other safe and legal innovation,” he says. “Whether it’s hemp-derived THC, delta-8 or delta-9 or some other innovation down the road, these are things that should be transparent to a regulator and subject to safety standards.”
The state’s Craft Cannabis Coalition, a retail-focused organization representing about 30 retailers from around the state, takes a different position, standing closer to that of the WSCA. Executive director Adán Espino says that if these products are allowed in the Evergreen State’s system, they should not only be regulated but come from within the state’s system to protect the growers.
“We’re not against innovation in the market, we just want to make sure it’s within the framework of the current regulations,” Espino says. “Any unregulated product can undermine the whole industry.”
But Charles also does not see his product as a threat to flower producers.
“At the end of the day, flower is still king. If you’re cultivating for flower and make a great flower-based product, your flower has nothing to worry about from our technology,” he says. “We make an ingredient for products.”
Meanwhile, Oliver, who represents outdoor and smaller, craft growers, sees potentially cascading effects throughout the cannabis industry that could cost jobs, taxes and whole companies, particularly in rural communities, and considers this a step away from the industry as we know it and toward “drug development techniques” used in the pharmaceutical industry.
“It’s not a direction our legal marijuana industry should go in,” she says.