In Pueblo, Colo., teenager Noah had smoked marijuana before. But most of his friends were using an extra-strong version, known as dabs. Thinking it might help with the insomnia that plagued him in his senior year of high school, Noah picked up a small torch, grabbed the glass smoking device known as a dab rig and heated a yellow, waxy substance into a vapor that he slowly inhaled.

For around two years, Noah, now 24, said the habit made him feel great. The type of marijuana he was loading as many as five times a day into a discreet dab pen – similar in look to a vaping device – was a concentrate, 75% to 98% of which was THC, or tetrahydrocannabinol, marijuana’s psychoactive ingredient.

Then Noah, who declined to give his last name due to concerns about discussing drug use, started vomiting a lot and having suicidal thoughts. He lost 30 pounds, had his gallbladder biopsied and was diagnosed with depression. No one could figure out what was wrong. Eventually, after looking up his symptoms online, he thought cannabis might be a possible cause.

As the U.S. government gathers data as part of a plan to review marijuana’s legal status by the end of 2023, and Germany, Europe’s economic powerhouse, weighs draft regulations for recreational weed this fall, they’ll hear success stories from some U.S. states. But behind local politicians’ boasts on the benefits of legalization – which often single out its tax revenue – growing data is charting the costs that states and society also bear. Some of the longest-running legalization programs in the U.S. are grappling with unintended consequences, and new opponents are seeking to rein in the industry’s excesses.

Noah is one of many cannabis users whose experience shows that the details of drug legalization matter. His hometown of Pueblo is a former Steel City that fell on tough economic times with the collapse of that industry in the 1980s and 1990s. After Colorado was among the first U.S. states to legalize medical marijuana in 2000, and recreational weed in 2014, Pueblo invited in more dispensaries than its more affluent neighbors to the north like Colorado Springs. It was supposed to be a boost to the city, which by 2016 was touted by county commissioner Sal Pace as the “Napa Valley of Pot.”

Instead, local emergency room doctors and psychiatrists say they see many patients like Noah, who’ve become dependent on the much-stronger forms of marijuana that have been created since commercialization of the drug. Pueblo-based psychiatrist Dr. Rajeev Kandukuri, 46, said that in the years since legalization, he’s seen an increasing number of patients struggle with addiction, amotivational syndrome and psychosis after heavy use of high-potency marijuana. The city’s working class and Hispanic community have been hardest hit, he said.

PSYCHOSIS, VOMITING

Data from the states with the most-developed markets, Colorado and Washington, have begun to show that it can take years for the impacts of commercialization to materialize.

In Colorado, calls to poison-control centers related to marijuana more than doubled from 106 two years before recreational legalization to 223 in 2014, and grew to 276 in 2019, the most recent year that state data is available. A separate study showed that from 2005 to 2015 at one hospital system, there were 4,202 marijuana-related urgent-care and emergency department visits by those ages 13 to 21, of which about 5% also got a diagnosis of schizophrenia or psychosis. That compares with a 0.25% to 0.64% prevalence among the general population. The number of annual marijuana-related visits among the same group climbed from about 500 in 2013 to almost 800 in 2015. Vomiting-related emergency room visits rose 29% from 2013 to 2018, according to a study that looked at whether legalization in Colorado was associated with an increase in such visits.

It’s all come at a cost: Private insurance often balks at covering mental health care, and many patients rely on Medicaid for such care, funded by state and federal tax dollars. Karen Randall, a doctor at a large Pueblo hospital, said she sees three or four cases a day related to cannabis, almost all of them on Medicaid. One chronic user was only 7 years old.

As state lawmakers attempt to address such concerns, raised by doctors and parents’ groups, they have zeroed in on cannabis’s most extreme forms: a new generation of raw flower with THC concentrations of 20% or higher, up steeply from the 4% levels seen 30 years ago; and concentrated products, like extracts and vape oils, which rarely start below 60% THC. The drive for regulation isn’t from the same groups who opposed legalization in the first place, but from many of the Democrats who pushed for it and now want lawmakers to “follow the science.”

Marijuana’s negative effects are hotly debated at any concentration of THC, leaving regulators with a political and scientific quagmire: Research into regular-potency marijuana is still in its early stages, and studies of how high THC concentrations impact everything from heart health to psychology lag even further behind. On top of that, there’s a chicken-and-egg problem that has long bedeviled studies of the significant overlap between drug use and mental health problems: which came first, a predisposition for an addiction, psychosis and schizophrenia, or a susceptibility to substance use.

While long-running legalization programs in some U.S. states should have been test cases, their data-keeping has been spotty. There’s no consensus on what level of THC classifies as high potency, and the market is flooded with synthetic versions of THC that make health impacts even more difficult to assess.

Last year, Colorado’s government was the first U.S. state to make major changes to its laws regulating high-potency products that limited purchases. But Washington, Florida, Vermont, Connecticut and – further afield – Germany have all had recent debates on the issue. More mature markets like Canada and Uruguay already have loose limits on concentrations of THC.

For the legal marijuana industry and states that rely on its tax revenue to fund public projects, the stakes are high. This year, more than a third of the U.S.’s $34 billion in expected cannabis sales will come from products high in THC. The data, shared exclusively with Bloomberg by New Frontier Data, shows the category is rapidly growing: last year, it made up only a quarter of sales. As efforts to regulate it mount, it isn’t just struggling cannabis companies who face risk; there’s also $1.25 billion a year in tax revenue that funds public programs that could be cut off in a crackdown. And as cannabis taxes have grown – surpassing alcohol and tobacco in at least one state – the marijuana industry has increasing sway.

RECREATIONAL DEMAND

When Rep. Lauren Davis sat before the U-shaped table helmed by Washington’s Regulated Substances & Gaming Committee in February, she leaned into the microphone and described a looming health plague on par with the opioid crisis.

“We’ve all borne witness to what happens when a for-profit industry is afforded the unfettered ability to market an addictive product,” she said.

For those familiar with old-school weed in the form of hand-rolled joints or the odd hash brownie, comparisons of cannabis to opioids can be hard to fathom. And marijuana was a political underdog for so long – partly due to the legacy of President Richard Nixon’s War on Drugs, which used it for racial targeting – that it’s hard to talk about the downsides without being labeled as a scaremonger or prohibitionist. But even legal, commonplace drugs like alcohol and tobacco, also available in varying strengths, have their drawbacks.

What’s clear is that cannabis has changed drastically in a way that’s amplifying its effects. The concentration of THC in raw flower climbed from around 4% in 1995 to 15% in 2021, according to samples seized by the U.S. Drug Enforcement Administration. Advanced genetics used by legal, publicly held companies have made that even higher in some markets: in Colorado, flower is sometimes seen with 35% THC, the plant’s biological limit.

The legal market has also helped create a new breed of supercharged products. Wax, shatter, dabs, budder and other concentrates have THC content that’s usually 60% and up, according to New Frontier. Vape cartridges have average concentrations from 70% to 90%. And many of them come in the kind of fruit flavors that got the tobacco vape industry accused of marketing specifically to teens. Edibles can also be incredibly potent.

THC binds with receptors in the brain, causing altered perceptions or even hallucinations in high doses, and triggering dopamine, the brain’s reward system. In doing so, it changes the brain’s function, and interferes with learning and reaction time.

A spokeswoman for the U.S. Cannabis Council, an industry lobbying group, said that millions of Americans regularly consume marijuana products without any issues. The group says that medical patients often need higher potency products to get a therapeutic effect.

But medical patients aren’t the ones driving the market for high-potency products. Companies in the cannabis space have made it clear that recreational users are pushing the increase in THC, and that they see their role as customer-centric businesses that need to cater to their preferences.

“Demand for the higher potency is coming from the recreational market,” Irwin Simon, the chief executive officer of Tilray Brands, said January in an interview. The cannabis company said that month that it plans to “build up on the potency side,” adding more than 150 new vape and pre-rolled products. In an interview in July, Simon said consumer demand for high-potency THC has continued.

“It’s no different than you want some products with higher alcohol levels,” he said, adding that he doesn’t see the trend going away. Tilray declined to comment on any potential health risks of high-potency products.

Companies across all markets now talk about high THC as a competitive advantage. In Canada, Cronos, which counts Marlboro-maker Altria as a financial backer, said on a May earnings call that it has a new Mango Kiwi Haze vape product with 32% THC. Organigram, backed by British American Tobacco, had talked about meeting consumers’ preferences both through high-potency dried flower and a lozenge called Edison JOLTS, which contains 100mg of THC per package. A representative for Cronos said that the potency levels of its products are formulated to meet market demand. Organigram didn’t respond to requests for comment.

With opioids or alcohol, high doses can quickly shut down areas of the brain responsible for breathing, leading to death. With too much THC, there’s usually no fatal event. While that’s long been touted as a benefit of the drug, it also has a downside. Heavy users often need to consume higher and higher THC concentrations to keep up with their rising tolerance. And data shows that in states where cannabis has been legal a long time, there are more heavy cannabis users.

It will take multiyear studies to know more about the physical and psychological effect of high-potency cannabis, some of which are already underway. But not in time to settle the debate over Davis’s bill in Washington.

By late February, it was clear that her proposals to rein in high-potency cannabis – two bills that would ban the marketing of high-potency products, tax them at higher rates and require buyers to be over age 25 – had failed.

‘TOO LATE’

Across the Rocky Mountains, in Colorado, a similar push to regulate high-potency pot started more than two years ago.

In May 2021, Judy Amabile, a Democratic representative of Colorado’s 13th District, spoke before the state’s House of Representatives. Amabile’s son, she said, smoked marijuana throughout high school and at 18 had his first psychotic break. She later discovered he’d been using high-potency products. After six weeks in a hospital at a total cost of $60,000, doctors diagnosed him with “schizoaffective disorder with co-occurring substance misuse.”

“He will never recover and our family is broken as a result,” she said. “It’s too late for him. Let’s talk instead about your children.”

In January 2022, a proposed bill adding restrictions on high-potency pot – a compromise between Colorado parents’ groups, doctors and the local cannabis industry – went into effect in the state. Coroners now screen for THC in nonnatural deaths. Medical marijuana cards are harder to get and a tracking system was created to limit purchases of THC concentrates to 8 grams per day, per customer.

The effect on the market was immediate: sales of medical marijuana fell from $28.3 million in December 2021 to $21.1 million the following month. Since then, they’ve shrunk further, down to $15 million as of May. Overall marijuana sales have also contracted: as of May, they’re down to $126.1 million – 44% below their 2020 peak of $226.4 million, according to monthly figures from the Colorado Department of Revenue.

But the state is still struggling with what’s next. One of the bill’s demands was a massive review on existing research into cannabis’s health risks, and a public health campaign based on the results.

The review, released in April, found some evidence to support two contradictory claims, crystallizing the challenges facing both the industry and its detractors. There was a moderate amount of evidence that high-concentration THC can have adverse effects on those with preexisting conditions such as psychosis, but there were also studies that showed beneficial outcomes when it was used for people with mental health conditions such as PTSD, anxiety, and depression. A recent study from the University of Bath also had mixed findings on the association of high potency cannabis and mental health symptoms.

For Noah, the former Pueblo resident who’s now studying psychology and law in Washington state, such contradictions need to be resolved if others are to avoid the lost years and confusion that he suffered. Under the guidance of Dr. Kandukuri, Noah quit cannabis and said his depression, vomiting and other problems quickly resolved.

“I thought marijuana helped with appetite, anxiety and would help calm me down,” Noah said, reflecting on why it took him so long to realize the drug was making him feel worse. “I blamed my problems on myself, not the marijuana.”

 

Bloomberg’s Richard Abbey contributed to this report.

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