The Cannabis Industry's Potency Inflation Problem

Features - Cover Story

Cannabis industry members say lab shopping and THC potency inflation hurt the market, consumers and patients. What can be done about it?

October 31, 2022

Illustrations by Cat Sims

Before NFL star and former Heisman trophy winner Ricky Williams partnered with Los Angeles-based vertically integrated cannabis business Ball Family Farms on a cultivar collaboration, Williams was drawn to Ball Family Farms’ product because of a couple simple things: taste and effect.

Williams, founder and president of the cannabis brand Highsman, who pheno-hunted the cultivar called Ricky Baker inspired by a character from the film “Boyz N the Hood,” tells Cannabis Business Times: “For me, the whole point of cannabis is the idea of feeling good. So, to me, what feels good is the flavor, the taste, and then the way I feel. So for me personally, that’s my sweet spot.

“For everyone, I just want to educate them to know that there’s nuance here. And when you try different flower, ask yourself, how does this taste? What flavors do I taste? Do I like it? Do I not like it? And then compare it to how you feel a couple minutes later.”

These are becoming more common refrains. Numerous industry members who recently spoke with CBT say that multiple cannabis compounds, such as terpenes and minor cannabinoids, at least in part epitomize the benefits of the plant.

But that’s not exactly how many cannabis consumers and patients are shopping for or interacting with their product. Many businesses in the cannabis industry continue to produce products with the highest amount of THC possible to match consumer and patient knowledge and demand.

Others might be fudging the numbers. An ongoing issue, cannabis industry members say, is that many U.S. cannabis businesses are "shopping" for testing laboratories that will provide the highest—that is, fraudulent—flower and concentrate THC potency results and marketing inaccurate results on produce labels.

Ben Rosman, a licensed attorney and CEO and co-founder of PSI Labs, which tests cannabis in California and Michigan, says his lab has had potential customers asking if it can inflate potency and existing customers relaying that they’re switching to another lab because they will receive a higher potency result. PSI Labs does not honor these requests, Rosman says.

“We’ve consistently, since legalization on the adult-use side, seen some pushback from some growers, like, ‘Hey, there are some labs out there that will increase potency. Can you guys help us out?’” Rosman says. “And it’s not something we’re willing to do. But that does mean that we lose clients over it. This is something that happens all across the country.”

Josh Wurzer, president and co-founder of cannabis testing laboratory SC Labs, which operates cannabis and hemp testing labs in several states, says potency inflation has mainly involved flower and concentrates. He hasn’t seen the incentive for labs to provide inaccurate results for infused products, which are labeled with milligrams of THC.

Explaining some similar customer experiences to PSI Labs’, Wurzer says: “You have customers calling and saying, ‘Hey, I need higher THC results,’ or implying that, and going to another laboratory that will give it to them.” He adds that SC Labs does not acquiesce.

Roger Brown is founder and president of ACS Laboratory in Sun City Center, Fla., which tests the state’s medical cannabis and has hemp clients in 48 states. He says he has observed a trend of some licensed cannabis growers sending samples to various labs, then deciding to work with the lab that offers the highest potency—a process infamously known as “lab shopping.” Brown says the last two times he has been asked by licensed growers to participate in shopping comparisons, he denied those requests.

Multiple Sides to Every Story

While many industry members CBT spoke with agree that lab shopping and potency inflation occur, not everyone is doing it. Also, labs sometimes make honest mistakes. And if one person or group at a lab or other cannabis business is purposely altering results, that doesn’t necessarily mean everyone at those businesses is in the know.

At Praxis Laboratory in Washington, former employee Keegan Skeate noticed potency inflation and brought it to the Washington Liquor and Cannabis Board’s (LCB) attention in April 2020, according to Pacific Northwest news outlet Crosscut.

LCB officials said none of the growers who received falsified test results from Praxis was being investigated, according to Crosscut. The outlet also interviewed one of the lab’s customers who said her business had questioned Praxis about a discrepancy between results provided to her business and those provided to the state. After a three-month investigation uncovered nearly 1,200 falsified results, the LCB suspended Praxis in December 2020 and later permanently banned the lab from providing quality assurance and potency testing. (CBT independently confirmed the ban with an LCB spokesperson.)

Justin Brandt, founding partner at Scottsdale, Ariz.-based law firm Bianchi & Brandt, says when regulators find labs are consistently having compliance issues, it becomes more apparent which labs are intentionally fudging numbers. However, mistakes such as clerical errors and testing anomalies can and do happen, he says.

Brown says ACS Laboratory recently made some mistakes and is taking responsibility for violations that caused the Florida Department of Health to fine the company $30,000 between July and August. CBT asked Brown about the violations, which were: using an unapproved analytical method; failing to notify the department of a retail batch that failed testing; and reporting inaccurate potency results (because of discrepancies between dry- and wet-weight reporting) on certificates of analysis (COAs). ACS Laboratory has paid the fines, he says.

Brown says the state of Florida is renewing laboratory licenses, and the lab missed including information on documentation for its ISO certificate, which led to the fines. “They’re going through all the documentation with a fine-tooth comb,” Brown says.

“We made the clerical errors; we corrected them very quickly and we paid the fine. And we own it—I’m not blaming it on anybody else,” Brown adds. “Somebody on my staff missed having that documentation done properly, but it doesn’t mean that the testing was done improper. The testing was done proper, the testing results were proper, and the product that was sold was proper. … It was our documentation supporting our certification that was a clerical error.”

CBT also reached out to Santa Barbara, Calif.-based vertically integrated company Glass House Brands after seeing WeedWeek had suggested the business’ F/ELD brand as one of seven cannabis brands with inflated potency.

WeedWeek, which sent prerolls to three labs whose executives have been vocally opposed to potency inflation, first conducted what the news outlet called an “imperfect experiment” of seven prerolls with two of those labs and published its results in September.

The news outlet then included an option for the brands to participate in a second test with a larger sample size with one of those same labs and a different one. Glass House’s F/ELD was one of two brands that accepted the offer to retest, according to WeedWeek. The “implied potency inflation,” meaning the percentage deviation between the THC content listed on the label and the news outlet’s findings, for the first test of one F/ELD concentrate-infused preroll was 53% to 77%, according to WeedWeek, and the implied inflation for the second test of a separate infused F/ELD preroll SKU was 14% to 26%.

Graham Farrar, founder and president of Glass House, tells CBT he doesn’t personally care about THC potency, citing the other beneficial compounds of cannabis, and that the company has never asked for any inflated potency results.

“I couldn’t tell you the details—I don’t know how you would make a higher number versus a lower number; I don’t know how that works,” Farrar says. “But as a cultivator, there is no way for us to differentiate between the accuracy of a lab. They all have the exact same [ISO 17025] certification. So, for us, it’s turnaround time, it’s cost, it’s customer service: Those are the things that we’re shopping for.”

Farrar says he believes the lab Glass House works with would be open to showing its cultivator customers how it conducts potency tests.

“If someone wants to come and take a tour of our farm, in general, we say yes and welcome them to come see [what] we do,” he says. (Glass House operations include a 5.5 million-square-foot greenhouse that went online earlier this year.) “So, I’d imagine the labs would be similar.”

BelCosta Labs produced the COAs for the F/ELD producted tested by WeedWeek. The company’s CEO, Myron Ronay, told the news outlet that he is confident in the lab’s test results.

Kelsey Hanley is a cannabis compliance expert at Allay Consulting, which has offices in Colorado and Oregon, and a former public health investigator for the Denver Department of Public Health and Environment. She offers an outside perspective on the WeedWeek report.

“I wonder what that natural degradation of cannabinoids looks like with the shelf life of [those prerolls] … depending on environmental exposures like heat or sunlight,” Hanley says. “So, I wonder if that has something to do with it, too.”

Temperature exposure and time on the shelf were some of the caveats that WeedWeek included in highlighting the imperfection of its report, alongside unrelated factors such as possible error or bias on the part of lab employees conducting the retests.

Shortly before press time, law firm Dovel & Luner filed a lawsuit against DreamFields Brands Inc. and Med For America Inc. on behalf of two purchasers of cannabis. The suit alleges that the defendants, which “make, sell, and market the ‘Jeeter’ brand of ‘prerolls,’” have labeled products as having higher THC percentages than those products contain.

Jeeter provided the following statement to CBT:

"Let us get straight to the point. The allegations regarding our THC levels are false. 

"We take pride in our compliance and commitment to state mandated testing procedures, including independent, third-party testing. The product and our integrity is something we truly value as a company, and take all the proper and legal steps before our product hits the shelves.

"We built this company with a foundation of morals, values and culture, and our love for cannabis. We take pride in all the jobs we have created and pushing the industry forward. 

"However baseless and ridiculous these claims are, we take them very seriously and look forward to the truth coming to light."

The lawsuit refers to the WeedWeek report, which stated that two Jeeter diamond-infused prerolls tested by the news outlet had “implied THC inflation” of 70% to 100%, and 28% to 42%.

The complaint states that “the primary reason that consumers purchase cannabis is for its psychological and medicinal effects, and those psychological and medicinal effects are largely driven by the THC content of the product.”

In a prepared statement provided to CBT, attorney Christin Cho of Dovel & Luner said: “Consumers are willing to pay more for cannabis products with higher THC content, and expect to pay less for cannabis products with lower THC content.”

WeedWeek wrote that Jeeter’s “Fire OG Diamond Infused 5-Pack Preroll” had “implied THC inflation” of 70% to 100%. Georg Kallert of Landau Labs, which tested products for Jeeter, told WeedWeek: “A review of provided COAs shows moisture content analysis was handled differently from Landau Labs … thus final results were artificially lowered.” (Landau Labs is not named in the lawsuit.)

Addressing Jeeter’s “Churros Diamond Infused 5-Pack Preroll,” which WeedWeek said had “implied THC inflation” of 28% to 42%, Kallert said Landau Labs stands by its results.

The court may allow additional plaintiffs to join the suit after a hearing.

Randall Quarles, a Florida medical cannabis patient who also runs an active ingredient-focused cannabis education initiative called The Amazing Flower, has become a cannabis THC potency testing vigilante of sorts and taken matters into his own hands. He says he recently used a non-destructive testing device, advertised for in-house testing, to conduct 162 tests of 42 flower products from seven of Florida’s largest medical cannabis companies.

While the device Quarles used advertises a 10% margin of error, he says he still found variations that fall outside that range. The flower he tested came back with an average of 17.2% THC, while the label average was 22%. The highest test result he found was 24.2% THC for a product labeled at 40.05%, and the lowest test result he found was 8.3% THC for a product labeled at 15.644%.

Quarles has received numerous comments on his LinkedIn post about the tests, with some commenters critiquing the near-infrared spectroscopy potency testing method of the device he used, compared to other more standard industry methods, such as high-performance liquid chromatography (HPLC) commonly used for cannabis potency tests.

“I didn’t really want it to be as controversial as it was …. I think everyone suspects [inaccurate labels]. But I don’t have any specific proof other than my test and a lot of rumors,” Quarles says. “You do hear stories.”

How Potency is Being Inflated

Industry members say there are multiple ways THC potency inflation can occur.

Rosman says labs themselves have increased potency results by adding kief. Some labs, he says, are “adding a little kief in and saying, ‘Well, kief falls out during the grinding process, so we want to add that kief back in because that kief should be part of the flower. So, because the kief fell out, we’re going to put that kief right back on top, and then that kief is going to be part of our diluted sample that we’re going to subsample from, and that will add 20, 30% of potency to it.’”

One way labs have inflated potency is through equipment calibration, note both Rosman and Wurzer.

“There’s a bunch of different ways that you can stack different measurements all in one direction,” Wurzer says, adding that this can be done through equipment calibration. “In every type of measurement we take as an analytical lab, there’s a certain amount of uncertainty—there’s a plus or minus attached to it. If you pile all those pluses or minuses in one direction, well, then, you’re giving someone an edge.”

Another inflation method involves inserting concentrates into flower samples before they’re tested. Before the passage of Proposition 64 in California in 2016, Wurzer says cannabis growers there were manipulating test results that way.

“[Growers] can’t really pull things like they did before regulations, where we would have customers that would take and inject concentrate right into the inside of the bud,” he says. “Then you would go to break up the bud, and in the middle, there would be all this concentrate. And we’d have to call up the customer, be like, ‘Hey. You can’t be doing this. And if you keep doing this, we’re going to have to fire you as a customer.’”

Wurzer says issues can arise when third-party sampling isn’t required. “There’s a whole bunch of different things that could theoretically happen between the product being produced and what actually ends up getting tested,” Wurzer says.

Third-party sampling is required in multiple other states in addition to California, such as Florida and Utah (which has one testing lab), but not others, such as Colorado and Arizona.

“I think third-party sampling is imperative because you have to go there and randomly sample the product,” Brown says. “In Florida, we have to take the actual finished product that patients in Florida are going to receive. So, they actually have to go through the packaging process. So, it’s almost like a penalty on a grower if they make a bad product.”

Rosman points to one study, published in the Journal of Cannabis Research in 2021, that outlines “unusual shifts” in potency testing data in two states. Author Michael J. Zoorob, a then-postdoctoral research associate at Harvard University who is currently employed by Meta, analyzed THC results in Nevada and Washington. Zoorob states in the paper: “There is a statistically unusual spike in the frequency of products reporting just higher than 20% THC in both states consistent with economic incentives for products to contain at least 20% THC.”

Additionally, Rosman told CBT, “I was talking to one of my colleagues in the industry … who’s doing his own secret-shopper studies and going out to a number of different dispensaries and just asking for the highest-potency stuff [they] have, and then testing it in his own lab. He sees results with variances of 30% to upwards of 70%. We do our own secret-shopper studies, and we see similar results.”

Why Potency Inflation is a Problem

Potency inflation can create multiple problems for the cannabis market. One is that it misrepresents the desirable attributes of cannabis, Wurzer says, adding that terpenes are a better determination of quality.

Another concern is that potency inflation sets an unrealistic bar for others in the industry who are following the rules, Rosman says.

“Growers and manufacturers and the cannabis industry in general can do everything they can to try and educate consumers on what a high THC result on an inhalable product really means,” Wurzer says. “THC isn’t your quantitative quality indicator for cannabis. That’s going to be the terpenes. The terpenes are what’s going to give cannabis its flavor, its aroma, the nuances and its effect. Those are really the quantitative quality indicators for cannabis.”

What the industry values about cannabis does not always align with everyday consumers, however.

Chris Ball, owner and CEO of Ball Family Farms, says: “The way I see consumers shop now is purely based off of THC content and the color of weed. I don’t really see them trying to understand what all the different terpene profiles mean. I don’t see them trying to understand, asking the questions, ‘Well, what was this grown in? How was it grown? What media was this grown in?’ I don’t see them really studying brands and kind of figuring out if this brand is sustainable, what the reputation is, [etc].”

Williams, too, has witnessed consumers look to purchase products based solely on THC levels without realizing what the plant’s additional compounds have to offer. “I remember I was doing a dispensary visit and this older woman came and she said, ‘I’m looking for the highest THC,’” he says. “And I was like, ‘well, what kind of flavors do you like?’ She was like, ‘flavors? I don’t know. I just want to get high and go to sleep.’ So I was like, ‘All right, highest THC—let’s find you something that that works for you.’ But I could tell she didn’t even realize she could have a different kind of experience with it.”

Rosman says potency inflation isn’t doing any favors for industry members who are producing product with lower THC percentages. “Ultimately, it’s really not good for anyone, and it’s especially not good for growers, because growers with some of the best weed out there then have to compete with mid-grade growers who have so-so weed, ” he says.

For Brown’s part, he says when potency inflation happens, “the ultimate loser is the patient or the consumer. If somebody is pumping up their THC levels, how do I know that they’re not passing their contaminants inappropriately, as well?”

Falsified Contamination Results

Inaccurate contaminant testing is a lab testing issue that does more than give companies a competitive edge—it can directly affect consumer health.

In California, Wurzer says issues with contaminant testing cropped up a few years ago, with some cannabis producers not being able to adequately avoid using pesticides or address microbiological contaminant concerns, and labs didn’t always have the most sensitive tests. Some cannabis companies have sought labs’ help to deflate microbial results, Wurzer says, though he says the issue is less widespread than it once was.

“We’ve seen it with micro[-biological] testing for different pathogens, where we’ll … ding someone for having aspergillus in their facility and it shows up in all of their products,” Wurzer says. “And we’re like, ‘Hey, you’ve got to address this mold situation. It’s not going to go away.’ And then they say, ‘Well, I’m going to go over to this other lab. They don’t see it when they test it.’ So that certainly is an issue.”

Rosman says lab results for contaminant testing are sometimes inaccurate in Michigan.

“Total yeast and mold is one of the tests,” Rosman says. “Another one—aspergillus—seems to be an issue, at least in Michigan. You’ve got a moist, warm environment; microbiological contamination proliferates, or at least it likes those kinds of environments. Also, in … some [states] … like California, … you have some approved fungicides and insecticides, pesticides, but it has to be under a certain action limit. In Michigan, essentially everything is banned.”

When asked by CBT whether those inaccurate tests have been the result of negligence or were intentionally mislabeled, Rosman said: “… in cannabis compliance testing, ethics and negligence are inextricably linked. Simply put, it is unethical for a testing lab to offer its services and perform with negligence.”

Solving the Issue

Regulatory enforcement actions for alleged lab violations are taking more severe forms than mere wrist slaps. Consider LCB’s permanent ban on Praxis’ quality assurance and potency testing certificates in Washington, or the Nevada Compliance Board seeking a nearly 10-year industry ban of testing lab Cannex for a range of alleged testing misrepresentations, including of THC and microbial and heavy metal content.

Consumer lawsuits alleging misconduct by cannabis companies extend beyond the October complaint against DreamFields Brands and Med For America. In Arkansas in July, for example, cannabis patients filed a RICO (Racketeer Influenced and Corrupt Organizations) suit against four licensed medical cannabis companies, including a lab, for allegedly inflating THC percentages.

While Brandt says he believes lawsuits could lead to meaningful action on potency inflation, he doesn’t think a RICO lawsuit is the best type of case for cannabis consumers to file because in those cases, the consumers are admitting they engaged in federally illegal activity. (Editor’s note: Read more CBT coverage on RICO lawsuits in cannabis here.)

“Most states have consumer protection laws that I think would be applicable to situations, especially if it’s a medical program, that would give patients or consumers viable claims against those labs or operators,” Brandt says.

Outlining actions that are taken against labs potentially inflating THC percentages, Wurzer says: “There’s the shame route [and] there’s the legal action route. I think you might see people starting to get a little bit more aggressive in [those approaches].

“But I think it would behoove the industry and regulators to solve the problem before it gets to be messy like that, because obviously, lawsuits and anonymous letters about specific brands—when you start doing that kind of stuff, innocent people can get caught up in that. And I would much rather see regulators doing it in an organized fashion and really trying to hold the industry to the standards they’ve already established.”

To help solve potency inflation in the industry, Rosman suggested all cannabis testing data be made publicly available to universities and data statisticians. However, he says Freedom of Information Act (FOIA) requests for public testing data have been denied in many states.

“It is my interpretation that publicly available data will translate to more accurate lab results,” Rosman says. “Transparency is fundamental in science, in general, and is a critical component of accuracy overall. Entire data sets need to be analyzed to come to a true understanding of these lab results.”

Another method to mitigate testing issues is for regulators to automatically audit cannabis product over a certain percentage, Wurzer says. Michigan’s Cannabis Regulatory Agency, for example, automatically audits test results over 28% total THC, he points out.

On the other side of the country, California is working to standardize lab testing. In 2021, California Senator John Laird (D-Santa Cruz) introduced Senate Bill 544, which requires the state’s Department of Cannabis Control (DCC) to develop a standardized cannabinoid testing method for labs by Jan. 1, 2023. The measure passed the legislature and was signed into law by Gov. Gavin Newsom later that year.

Regarding SB 544, Wurzer says it is “well-intentioned but misguided.” He explains: “The idea was if everyone’s using the same testing method, they should all get the same results. But a lot of the tricks that you can use to stack the results in your favor, you can do just the same with a standardized method.

“Now all you’re doing is pigeon- holing all the labs into a single method where they can’t innovate, they can’t add new analytes to measure, they can’t improve the accuracy of their test or improve the speed or make it cheaper or less wasteful or whatever. They’re just all kind of stuck using the same method. But the cheaters can still cheat. So, … most states are trying to do something to address it. It just really takes engagement from the regulators to do a good job.”

California’s DCC has been drafting regulations in accordance with SB 544 that must be complete by Jan. 1, 2023. Managers from various California- licensed labs had criticized previously proposed rules in public comment, stating they could lead to additional challenges for labs and the industry, such as increased costs and inaccurate testing for certain product types, like edibles. On Oct. 20, public comment closed on the DCC’s third iteration of its proposed rule set, which included the update of applying the proposed standardized test method solely to flower, including prerolls.

Wurzer said earlier in the DCC’s rulemaking process that it’s important for various sample types, also called “matrix types,” to undergo different extraction procedures. “There’s cannabis flowers and cannabis concentrates, and that extraction and sample preparation is pretty straightforward,” he said. “But then we also have to measure cannabinoids in everything from chocolates to gummy bears to bath bombs to soda. And each one of those sample types requires a different procedure to make sure that we’re properly extracting the ingredients that we need to measure.”

Addressing standardization, Hanley says ISO 17025 accreditation is common for labs in the industry, and some states require it. Meanwhile, more states are beginning to require good manufacturing practice (GMP) certification for cannabis companies or are offering incentives to companies that follow it.

But there needs to be a complete level of standardization to separate the good from bad actors, she says—“an industry-wide cannabis testing standard based on science.”

“That would be like … ‘This is how you test for potency,’ or ‘This is how you test for heavy metals’—like a flatline, industry-accepted method,” Hanley says. “That would cut down on all these influxes of testing results that we see that are unintentional.”

Farrar also says standardization is needed, alongside more consumer knowledge and education about the importance of cannabis components such as terpenes and genetic lineages of cultivars.

“All we want is everybody to be on a level playing field,” Farrar says. “I don’t care if the [THC percentage] is 32, 22 or 18, as long as we’re not competing with somebody with a fake number with [our] real number because we know that people still shop by that.”

A DCC spokesperson says that, in addition to its standardization effort, the department is addressing potency inflation and lab shopping in other ways. For example, the DCC samples and tests product from retail store shelves; conducts in-person, unannounced lab audits; takes administrative and enforcement actions against labs that fail to remediate potency inflation issues; and actively responds to labs’ concerns and complaints. In the future, the spokesperson says, the DCC will conduct forums with testing laboratories.

In Florida, Brown proposes potency inflation could be better addressed if regulators were to form a coalition with a small group of qualified laboratories. The regulators would select products from retail stores, and the labs would independently test them.

“Let’s just say four labs in the state of Florida say, ‘OK, we’ll agree to do a coalition with the regulators.’ And the regulator goes and randomly samples products in dispensaries,” Brown says. “And I would say, ‘OK, I’ll take four samples, and I’m going to send them out to these four labs to be tested to make sure that their labels are correct.’

“Well, you only have to catch fallacious labeling a few times to prevent people from going with laboratories that are going to pump up the numbers, and then fine them. It’s really that simple. If you send it to four labs, and all four labs give you results that it’s 20%, 22%, 21%, 19%, but the label says 30%, [you’ll] know there’s something wrong.”

Brandt says no single action would entirely solve cannabis lab testing issues, but one thing he says state officials can do is implement third-party sampling requirements like Utah has in its medical cannabis program.

“In Utah, the labs actually go to the operators, and they’re the ones selecting the samples,” Brandt says. “… Typically, you’re not going to have issues where operators are manipulating their samples—either putting distillate on it or some form of concentrate on their batch samples for testing—before it gets to the lab.”

On the lab side, Wurzer says bad actors represent a small portion of companies in the cannabis industry and that most don’t want to mislead consumers.

“Most of the laboratories that I’ve talked to and that I compare data with are doing a good job, too,” he says. “They’re just looking for a way to solve this problem so they don’t go out of business because they’re not willing to sacrifice their integrity.

“So, I think it falls on all of us to try and find a solution. Part of it is educating these consumers, highlighting the importance of flavor and terpenes over high-THC results. But I don’t think it’s all doom and gloom. I think in the end, the cream will rise to the top, and the good actors will prevail.”

Patrick Williams is managing editor for Cannabis Business Times.

Senior Editor Zach Mentz contributed to this report.