Advertisement
Business

There is a rapidly expanding, virtually unregulated competitor to medical cannabis in Maryland. It’s called Delta-8.

You no longer need a medical card to legally get high on cannabis in Maryland.

The state spent years setting up a medical cannabis industry that is tightly regulated at every step from seed to sale. Dispensaries, processors and cultivators spent millions of dollars creating an entirely new industry under the impression that everyone would compete under the same rules.

Advertisement

Now, anyone can walk into one of hundreds of CBD stores, head shops and gas stations across the state and legally buy a cannabis-derived product that has a psychoactive effect similar to a gummy from a dispensary.

It’s called Delta-8.

Advertisement

Delta-8 is one of more than a hundred closely related compounds found in the cannabis plant called cannabinoids. Its chemical structure is nearly identical to THC, the main psychoactive component in cannabis.

Delta-8 is found in small amounts in hemp. It’s legal thanks to a loophole in federal legislation that passed in 2018. And it’s virtually unregulated. As a result, it’s generally cheaper than the cannabis sold at dispensaries. And it’s rapidly grown into an industry that some estimate has $50 million of annual revenue in Maryland — if not more.

Critics and users alike are concerned that it could pose a public health risk. More than 20 states have regulated or banned the sale of Delta-8, including Virginia, starting July 1.

The Maryland General Assembly considered banning it during the recent session but opted instead for a yearlong study, punting the issue until next year. Meanwhile, Maryland voters are expected to legalize recreational cannabis in a November referendum, but it could take a couple of years after that to hammer out regulations, launch a new industry and start selling.

In the meantime, the Delta-8 industry appears to be filling this vacuum.

Will Tilburg, executive director of the Maryland Medical Cannabis Commission, testified about the Delta-8 during a March hearing.

“As the state’s medical cannabis regulator, we receive a lot of calls, emails, other correspondence from patients and parents concerned about what they think are medical cannabis products,” Tilburg said. “In actuality, they end up being Delta-8 THC products. … They are untested, unregulated and it’s unknown largely what is within them.”

He said a Maryland woman ended up hospitalized because of Delta-8. The woman later took the product to an independent lab, which said it contained copper, a potentially fatal metal that shuts down the liver, Tilburg said.

Advertisement

The CDC issued a health alert in September about Delta-8, saying there were 660 adverse events related to Delta-8 reported from January through July 2021, including 119 hospitalizations. Nearly 40% of the adverse events involved people under 18.

Nicholas Patrick, who sells Delta-8 at his three Embrace CBD stores in Maryland, believes the industry needs regulation.

“We want regulation bad. We want regulation not just for Delta-8. We want regulation for all hemp products,” Patrick said. “The whole reason my wife and I started this company was because of the lack of regulation. Nobody was doing a good job of self-policing and they’re just selling God knows what to whoever with no lab testing, no vetting.”

Patrick’s store in an Ellicott City strip mall looks like a medical cannabis dispensary. There are Delta-8 gummies and vape cartridges for sale behind glass counters.

Customers who prefer smoking their cannabis can get pre-rolled joints at Embrace CBD, using dried hemp flower that looks like medical cannabis and has been sprayed with a distillate of Delta-8.

Embrace CBD’s customer base is a mix of people, Patrick said. Some can’t afford to get a medical cannabis card, which requires meeting with a health care provider plus a $50 fee. Others are gun owners who are restricted from having medical cannabis and possessing a firearm. Some have jobs that bar them from using medical cannabis.

Advertisement

But many just prefer Delta-8, Patrick said.

“There’s a lot of people who cannot tolerate the extreme potency of the products at dispensaries. I myself am one of those people,” he said. “I’m a medical patient, but I cannot use those products. I have severe effects of paranoia whenever I use any of those products.”

Delta-8 gives a different, less-potent high than medical cannabis, Patrick said, and it has transformed the CBD industry.

When he opened his original location in Glen Burnie in 2019, Patrick primarily sold products made from CBD, another cannabinoid found in the cannabis plant. He said monthly revenues were $50,000 to $60,000. But prices plummeted as more farmers grew hemp, saturating the market, Patrick said, and monthly revenue tumbled to $30,000 or lower.

By pivoting to Delta-8, that same store recently brought in $77,000 in a single month, he said. While that’s far below the $450,000 in median monthly revenue of medical dispensaries, according to state regulators, Patrick said Delta-8 has been a lifeline for businesses like his in Maryland.

What worries Patrick is that Delta-8 also has been a boon to gas stations and convenience stores where products are sold to anyone.

Advertisement

“You can go to a gas station and buy a vape card or a gummy that says ‘Barely Legal,’” he said. “I saw another one called, excuse my language, it was called ‘FukedUp.’ F-U-K-E-D. That’s the brand.”

Patrick said he tries to be choosy about what Delta-8 products he sells, working mostly with Georgetown Hemp, a Maryland company run by Daniel Simmonds.

Georgetown Hemp distributes Delta-8 products to CBD stores, pharmacies and vape shops all across the country, Simmonds said, including about 50 to 60 stores in Maryland. Many of those stores now depend on Delta-8, he said, estimating that 60% to 80% of their business is selling Delta-8 products.

Simmonds said gas stations are not interested in Georgetown Hemp products because they’re more expensive and marketed more for therapeutic effects — not for getting people high. Like Patrick, Simmonds is a medical cannabis patient, but uses Delta-8 instead.

Advertisement

“Delta-8 is my magic bullet for treating my pain and my nausea while still being able to function,” Simmonds said.

He wanted other people to have similar relief, but Simmonds said much of the Delta-8 products sold in Maryland and around the country don’t actually contain what’s on the label.

Despite its name, Georgetown Hemp does not grow or process hemp. Instead, Simmonds said the company buys Delta-8 distillate in bulk, tests it and then uses it to make its own products.

He declined to say where Georgetown Hemp buys its distillate from, citing competitive reasons, but it’s likely not Maryland, where farmers planted just 30 acres of hemp last year, according to a U.S. Department of Agriculture survey. Colorado is the nation’s top grower with more than 10,000 acres.

Advertisement

In the best-case scenario, Delta-8 comes from a farm where the farmer tests the soil for pesticides and heavy metals, then tests the hemp after it’s harvested. Then it goes to a processor who extracts the cannabinoids like Delta-8 and tests it a third time. That processor converts other cannabinoids into Delta-8 using solvents bought from a reputable lab, then washes the synthesized Delta-8 in water of various pH levels to remove any lingering contaminants and runs it through a filter. The eventual distillate is then used for a variety of products that are accurately labeled.

In Maryland, that’s rarely the case, according to Barry Pritchard.

Pritchard is a chemist who runs SunX Analytical, a Cambridge company that tests hemp products for farmers. Pritchard said he started tinkering with Delta-8 about two years ago, buying Delta-8 products sold in Maryland stores and testing them.

According to Pritchard, none of the 15 or so products he tested contained what was advertised.

While Pritchard thinks Georgetown Hemp is a reputable seller, he claims other companies — even ones that purport to do lab testing — are cutting corners and lying about the contents of their products.

Advertisement

“The testing and regulatory environment are terrible,” he said.

Pritchard fears something similar to the 2019 outbreak of lung disease in vape users. According to the CDC, nearly 3,000 hospitalizations and 68 deaths were likely caused by a thickening agent added to illicit vape cartridges.

“Somebody’s going to get hurt by what’s being sold,” Pritchard said of Delta-8.

But many of the concerns behind Delta-8 are not actually about health and safety, he said; it’s really about money.

Pritchard said he spoke with a few other people in Maryland’s Delta-8 industry and did some rough math. He estimated that there are 250 stores in Maryland selling at least $40 million to $60 million worth of Delta-8 products a year.

Advertisement

This is a small fraction of Maryland’s medical cannabis industry, which hit about $600 million in revenue last year, but Pritchard said Delta-8 is a serious threat to medical cannabis.

While dispensaries and CBD stores may tout the health benefits of their respective products, Pritchard said many folks buy them for one simple reason.

“It’s about getting high,” Pritchard said. “It’s OK. Let’s be honest about it. How many people use it for true medical value?”

Pritchard described the 2022 legislative session as the “first volley” in a much larger fight over the future of cannabis use in Maryland.

Tilburg, the cannabis commission head, sent a letter to lawmakers Jan. 13 calling Delta-8 a “potential public health crisis” and encouraging them to consider legislative action.

“Many of these products are marketed and sold online and in brick-and-mortar stores expressly for their intoxicating effects,” Tilburg wrote. “These products are available across Maryland, most commonly without any age restrictions.”

Advertisement

In February, Sen. Brian Feldman, a Montgomery County Democrat, filed emergency legislation to ban the sale of Delta-8.

Patrick and Simmonds started a GoFundMe campaign a week later, raising more than $40,000 to hire a lobbyist and for public relations work. More than $20,000 appeared to come from donors connected to the Delta-8 industry in other states. Patrick said he reached out to a few big manufacturers outside Maryland.

“I said, ‘Hey, I know you guys are in every smoke shop that’s selling Delta-8. Hope you know that they’re trying to get rid of it in the state of Maryland,’” Patrick said. “And I told them that we had a grassroots effort going and they threw some money at the GoFundMe.”

Delta-8 advocates eventually met with Feldman, Simmonds said, and the senator told them that the proposed ban was being pushed by a lobbyist for the medical cannabis industry and the Maryland Medical Cannabis Commission.

Ashlie Bagwell, a lobbyist for the Maryland Medical Dispensary Association, said she did not push to introduce a ban, though the association did support the legislation.

Feldman told The Baltimore Sun the bill originated from concerns raised by state regulators — not the medical cannabis industry — but he decided to revise it after pushback “that this is more complicated than it would appear.”

Advertisement

“We want to make sure we do it right as opposed to just winging it,” Feldman said.

The amended bill no longer banned Delta-8. Instead, it restricted its sale to people 21 or older and set up a monthslong study, which Tilburg supported. The bill passed into law a report on Delta-8 that is due Jan. 1. Feldman said lawmakers will decide during the 2023 session how to regulate the cannabinoid and others.

Jake Van Wingerden of SunMed Growers, one of Maryland’s biggest medical cannabis cultivators, said his industry was shocked that lawmakers did not ban the sale of Delta-8 in the meantime.

“The hemp lobby here in Maryland hired the right lobbyist, I guess,” Van Wingerden said.

The Evening Sun

The Evening Sun

Daily

Get your evening news in your e-mail inbox. Get all the top news and sports from the baltimoresun.com.

At least one dispensary owner, Hope Wiseman, has a more nuanced view of Delta-8. Wiseman owns Mary & Main, a medical cannabis dispensary in Prince George’s County. She is one of relatively few Black owners in Maryland’s medical cannabis industry. It would take millions of dollars for someone to break into today’s tightly regulated market, but she said she knows folks of color who are building businesses around Delta-8.

She wants Delta-8 to be regulated, but it could be the pathway for minorities who were effectively locked out of the medical cannabis industry.

Advertisement

“Delta-8 is a way to get into the [cannabis] space,” Wiseman said. “You’re gaining experience and capital to put towards another business model in the future. I see both sides.”

But Van Wingerden thinks it’s “crazy” that lawmakers didn’t close a loophole on a product that is totally unregulated — not to mention a direct competitor to an industry the state has been developing for years.

“It’s definitely an issue that we’re going to be laser-focused on moving forward,” he said.

Simmonds said the Delta-8 industry will be ready for that fight. He went to a hemp summit in Chicago recently where lobbying was discussed.

“They’re gonna match or outspend marijuana lobbying in Maryland for sure,” Simmonds said. “There’s a lot of money going into this.”


Advertisement