Florida’s Medical Cannabis Market: The Truth Behind Inflated THC Potency

For quite some time now, as cannabis slowly comes online into the legal space across the country, each respective state is finding their own sets of issues to contend with regarding loopholes or just a general lack of technical knowledge in this space.

Regarding the medicinal cannabis market in Florida, one of the biggest issues plaguing the legal cannabis sector besides a grey alt-cannabinoid market is the inflated potency and lab fraud regarding THC values.

What is the accusation regarding inflated potency?

MMTCs (medical marijuana treatment centers, aka dispensaries) have a CMTL (certified marijuana testing laboratory) sample and subsequently conduct a series of tests on a product that is up for market circulation and sale. One of these tests conducted is potency, or the amount of THC, CBD, and other cannabinoids in a product.

When the potency results come back, they are reported in a series of milligrams (mg) per package and by percentages. They are also reported "as received" or a "wet weight", but you may find a "dry weight" value and percentage listed as well. This is the case for what the Office of Medical Marijuana Use (OMMU) defines as usable whole-flower marijuana or the bud/flower you may see in photos or in the media. 

When marijuana, or any plant matter in this instance, is tested, the moisture content (wet weight) is determined. This includes marijuana buds/flower that has been dried/cured. In most instances, properly dried cannabis contains somewhere between 10-15% (Florida’s allowed maximum is 15%). What some CMTLs do is either do a dry weight correction or just dry the bud further in an oven and re-test.

The removal of any excess moisture further concentrates the remaining plant mass and THC amount. Even if the amount of THC present on the flower doesn't change, because the total THC is now reported on a lower mass, the THC % is always higher than what was tested prior to being dried or mathematically corrected for dry weight since the additional moisture is gone.  The drying process also takes place at a high enough temperature to drive off most of the terpenes, further decreasing the overall mass of the flower and increasing potency.

For the non-technical/compliance people, one way of thinking about this to imagine your typical 8oz glass of water in a Solo cup vs that same amount bring poured into grandma's iced tea pitcher. The % of space the water takes up in a Solo cup is much higher than the % of space taken up in grandma's pitcher.

Under current Florida OMMU regulations, the labs (CMTLs) must report on the final certificate of analysis (CoA) THC potency based on the "as received" moisture content. Does it explicitly tell a lab that they can't also post the dry weight on their CoA? No. Do the MMTCs have to use what is reported on a CoA? Yes. Does it tell them they can't use the dry weight? No. 

And herein lies the problem. 

While the CMTL is under regulatory and legal obligation to report accurate values and report the potency under the "as received" moisture content, nothing stops them from also adding the dry weight to the CoA. Meanwhile, the MMTC is not required to report a specific value.

Because of this loophole, they can use the dry weight and adjust their prices as necessary to reflect the higher potency. Is the product sold to the consumer at this higher potency value?

No. It will be at whatever the "as received" or "wet weight" percentage is listed. This then becomes an intentional misleading of consumers who are spending an increased amount of money for cannabis flower that says 35% on the label, when it may only actually have 29% based on the actual, scientifically accurate value. 

This misrepresentation of the THC values then created a new demand for labs that would post these dry weight values, with MMTCs leaving long-standing relationships with various labs who may have refused to post dry weight, in favor of labs who would.

This created financial troubles and collapses in some CMTLs while others flourished. With the vertical integration of the Florida market, there are only 22 licensed MMTCs.  Each one holds significant power over their lab.  A lab may only regularly test for 4 or 5 (or less) MMTCs, so if one MMTC threatens to take their business elsewhere unless the lab does something shady for them, the lab is under pressure to comply. 

However, it wasn't long before the OMMU caught on. During the last year several labs have been fined for posting only the dry weight on their CoAs, but fines usually maxed out in paltry amounts totaling around $10,000.

With these labs stealing business and holding a significant amount of market share of the testing, the revenue and profit margins easily beat out any fines levied by the OMMU, causing them to be fined repeatedly, and paying it out as they came. Much of the accountability has befallen on the CMTLs, with none falling on the MMTCs.... until recently. 

On July 17th, the OMMU issued a compliance highlight addressed specifically to the MMTCs, while also being available for the public. The letter, posted below, outlines under Emergency Rule 64ER20-39(3) of the Florida Administrative Register that potency must be reported at the CMTL-tested moisture content and any potency tested at below tested moisture content must have mathematical correction. The letter goes on to then state that the correct potency is the potency value at the tested moisture content, or the "as received" or "wet weight" value.

While changes to the rule requiring reported results by MMTCs to be in the "as received weight" are not promulgated to rule yet and are on current drafts set to promulgate this summer, the letter states that the department recommends MMTCs always provide correct information to qualified patients, whether on labels or advertisements. The recommendation language without any enforcement is meant intentionally since they cannot enforce something that is not actively promulgated to rule yet in the register. 

The OMMU however, through means of this letter, has made it abundantly clear now that the behavior isn't going to be tolerated further, and to further drive this point home, list Rule 64-6.210(9)(nn) stating they are ready to fine people for engaging in inaccurate and fraudulent potency labeling. 

On Florida's medical marijuana subreddit, where users discuss their experiences in the program, a post dedicated to this notice was listed and overall the response has been negative, given they realized they've been charged higher prices by MMTCs for the last year or so on the product that's been artificially inflated in terms of potency. Public reaction to the notice has been met with anger at MMTCs as well as a mix of gratitude to the department for getting this under control, and annoyance to the department for taking so long to address this issue. Authorized representatives for the companies blasted on the subreddit began to do damage control to try to save face with consumers regarding inflated potency values or product quality. 

This goes on to a greater issue of how ignoring compliance can damage your brand and reputation. Compliance is often thought of as a necessary evil that only hinders business. It is seen as a burden and a cost; however, it is crucial for your business’s success. Without good compliance policies and cultures from the beginning, businesses can suffer tremendous reputation damage and financial loss.

This comes in multiple forms such as revenue loss, as customers choose more trustworthy brands, fines, and legal penalties or fees. It remains to be seen how reputation and financial losses will shake out for companies seen to have inflated potency in Florida, but a flurry of emails from companies such as Cookies and Trulieve regarding potency values and their CoAs have begun to make their way into the inboxes of Florida med card holders. 

In addition, there have been requests for the OMMU to make all NOVs (Notice of Violations), fine letters, RAIS (requests for additional information), inspections/audits, and other compliance information available for the public in an open forum, whereas now the only way to see these documents from the OMMU outside of a general notice is through a records request, which could take weeks to fulfill.

This is a common thing among other industries, and the MQA (Medical Quality Assurance) office at the DOH already does this for all discipline and administrative actions for doctors, dentists, massage therapists, optometrists, nursing homes, and other health professionals licensed by the DOH.

Going forward, will the issues of lab fraud be solved? While there are still some possible risks present even around potency, there are some thoughts that labs have moved onto other analyses to falsify data for. One big one being the microbiological contamination (Total Yeast and Mold Test). This potential issue, in addition to potency, is not restricted to Florida only. In fact, in Arizona alone, a cannabis lab was fined nearly $500,000 for intentional, inaccurate results on their testing CoAs, including one employee trained on how to inflate potency results, and another lab was discovered by a local journalist to be inflating THC potency as well.

With turmoil in other states, it begs the question on if and when the federal government will finally step in and set minimum standards for regulation of cannabis. At the time of this publication, the federal government still has cannabis set as a Schedule I substance, meaning is has no currently accepted medical use and a high potential for abuse. However, what is seen with states now hopefully won't be an issue elsewhere in the future.

With the creation of The Cannabis Regulators Association (CANNRA), which is a national organization of cannabis regulators that provide policy makers and regulatory agencies with resources for making informed decisions in their states, the lessons of Florida and elsewhere with potency will hopefully end with them. With more states coming online into the cannabis space, and more regulators joining into the CANNRA community, learning lessons of states already online, we may have a robust nationwide cannabis regulatory system long before the feds finally decide to get involved.