10/16/19 Jim MacRae Program Century of Lies Date 16 October, 2019 Guest Jim MacRae Link(s) Drug Policy Facts This week on Century of Lies we speak with data scientist and consultant Jim MacRae, PhD. Audio file TRANSCRIPT TRANSCRIPT CENTURY OF LIES OCTOBER 16, 2019 DEAN BECKER: The failure of the drug war is glaringly obvious to judges, cops, wardens, prosecutors, and millions more now calling for decriminalization, legalization – the end of prohibition. Let us investigate the Century of Lies. DOUG MCVAY: Hello and welcome to Century of Lies. I am your host, Doug McVay, Editor of DrugWarFacts.org. Jim McRae, PhD., is a data scientist and consultant based in Washington State. Since 2014, Dr. McRae has been using data supplied by the state merged with its proprietary compilations of industry related information to produce analytic summaries, metrics, and numerous insights for the legal cannabis industry in the state of Washington and industry regulators, operators, investors, consumers, patients, and observers. Lucky enough to have Dr. McRae on the phone with me now and Dr. McRae, thank you so much for your time today. As states have been moving forward with regulation of the medical and adult use markets, lab testing has been a central component but what exactly does testing really entail? It’s a broad term – lab testing. Is it potency is it pure – what does it mean? What are we doing? DR. JIM MCRAE: We’re lab testing and we are seeing it in the regulated cannabis markets and I – just up front – I know Washington State better than any that have done business in other states and I am aware of a number of them. The general categorization is two-fold. One is loosely called Potency Testing and normally when cannabinoid levels – typically THC and/or CBD and then Quality Assurance testing which is generally a set of pass/fail tests on the presence of things in the cannabis or the absence thereof of things that you don’t want to see again. Foreign matter, molds, salmonella, various things, micro toxins, too high a moisture level for products that might be stored in Ziploc baggies and (UNINTELLIGIBLE) on the shelves for a month (UNINTELLIGIBLE) that sort of thing. So the potency tests typically are cannabinoid levels they probably could increase (UNINTELLIGIBLE) and I am beginning to see this include terpene levels and so that people understand the profile of the product that they are taking (UNINTELLIGIBLE) to THC level or THC/CBD ratio will generally be mitigated or changed or altered and that would be some terpene profile and a few other things of the things that they are smoking so that is what the testing is about and people are looking to see how strong is the product, typically measured by cannabinoids today and is it safe? Does it pass all quality assurance testing standards? Does that answer your question? DOUG MCVAY: Very much so. Here is where I am going to admit that I sound stupid and I get most of my science information from television. I don’t think I am alone in this – a lab test – I think that I am not the only one who has an image of the scientist takes a sample of some substance and puts it in to major mass spec and a little while later there is a ding and out pops a piece of paper that has a list of stuff that was in the substance. It’s not really that simple, is it? Or is it? DR. JIM MCRAE Well, yeah. Except the way the system sets it up typically is they go to great lengths to ensure that the laboratories that are making these assessments – potency and the quality assurance – are certified. They are certified typically to either specific standards defined within the state, which is what Washington has done and Washington subcontracted that out to somebody in Pennsylvania, a company that does this for other labs, or a state will hold their labs accountable to be certified to a certain level of proficiency which is typically one of the (UNINTELLIGIBLE) or whatever it is, which is an international standard organization certifications for general analytical (UNINTELLIGIBLE). So if you are at that standard you can know how to run a math spectrometer or HTLC and they’re allowed to interpret the results. Typically these labs are required to have a lab director with doctoral level/graduate level accreditation and some of the analytic sciences, that sort of thing. So there are people on staff that know how to do it. There’s equipment that can do it and the certification bodies make sure that they are basically capable of doing the job and when you get to the real world where the accreditors – mom and dad I like to call them – are not looking over the shoulders of the laboratories and they start pumping out tens of thousands of tests in some instances more than that to support the regulated cannabis industry that is emerging in the current state to the extent that the states consumers have a tendency to smoking their flower for now, which is always usually the biggest seller. Looking for high THC flower – the labs that are able by whatever means to produce higher THC numbers have a tendency to get repeat business. The labs who (UNINTELLIGIBLE) would fail a quality assurance test tend to get repeat business. Where are they coming from? I don’t know but very clearly there are labs that if you quantify the labs on two very specific measures – what is their average cannabinoid level and terpenes should be included, what is the average cannabinoid level recording for flower and another one, which is what percentage of the flower fails at least one or more quality assurance tests and from that looking at the individual test is very informative but if you do that – you typically will see in any state that there’s a lab or a handful of small (UNINTELLIGIBLE) labs that are reporting higher THC levels than the others and not always, but they typically also show fewer smaller failure rates for product. So with a smaller failure rate that product can be sold with a statistically smaller potency level or cannabinoid level on the product than their competitors. The product tends to sell at a higher price and also by the way, more rapidly off of retail shelves and wholesale transaction frequencies as well. So it’s a win/win and I have labeled in some work I did in Washington State a few years ago – a pretty in-depth analysis on my blog. I called the labs that did that pattern of results either statistically, unexpectedly high potency levels or statistically unexpectedly low product quality failure rates and called them friendly labs with the view that they are friendly towards their clientele, which is typically the processors and/or the farms that are paying them to do these tests. Those labs by the way have a tendency to look at them to very quickly come to dominate some markets in terms of the testing that is done. So it’s not just a little corner thing. The farms and the processors tend to notice when a lab is getting six, seven, eight points higher THC than anybody else is and they tend to want to give their business to that player in some cases – not everybody but it quickly comes to dominate the market and I have seen that in multiple states. DOUG MCVAY: Well and it makes sense in terms of ethics, it takes two to tango. A few of the companies may be ethically challenged as it were and hoping to get the right results but how seriously does the industry as a whole take those concerns? DR. JIM MCRAE: What part of the industry are you talking about? I think most of the industry does (UNINTELLIGIBLE). DOUG MCVAY: Like I say, obviously there might be a few companies that are ethically challenged in that way but the industry does take this stuff seriously? DR. JIM MCRAE: Oh yeah. – DOUG MCVAY: Your specialty being Washington, we’ll stipulate that because that’s – but you’ve got one of the oldest systems in the state here in the country. DR. JIM MCRAE: -- So I will speak to Washington, I know a lot more about our state. We have five years of data under our belts and I know how this market has evolved on a very atomic level. We have more transparency in terms of our state laws and constitution than most states do so virtually all of the transactional data for the first three and a half years of the market are available for analysis and it’s just kick ass. Any way. I had two other states that come close to that in terms of what they make clearly available to anybody. But I built a business using those data firm numbers. Anyway, back to the point – having access to that sort of information allows you to specify things in the market that are not estimates but they are actually statements of how much of this is going on. So it is kind of a special thing and it’s really neat but it becomes a consumer beware type of thing and it can only go on in the context of when people can see it at any regulatory agency that has a traceability system that functions has access to these data. If they choose to, they can look at it and I have seen states that are all over this stuff and I think - I mean if I were to recommend in fairness to one state or the other at some point down the road when we ought to engage with those states. I would point them to certain states saying these states have their act together. You are more likely to have safe product on the shelves when their “passed quality assurance test” actually means something. Further, if you are going to be trying it you probably at least have a better idea of what the potency of the thing is based on what the label says –if labs are doing the honest and proper reporting. If they are not, if for whatever reason they are inflating cannabinoids and failing to fail a product that probably should fail or more specifically, demonstrating failure rates that are statistically smaller than that of their peers. There’s a lot on ancillary reason to explain that – it’s probably not true, or it’s at least questionable. DOUG MCVAY: I realize you are not a chemical engineer so this one might be a tough one but the vape crisis that has been happening. What are the concerns or some things that they may not have been testing for that might be showing up – Vitamin E Acetate is something that’s been pointed out as a possible concern and we have had well we do use it, we don’t use it…and then people are moving away from it if they did. Would that have been something that would have been apparent to a tester or are they basically testing for things that they need to test for but – I am not saying this right. Basically, if they are not looking for something specific would they necessarily find it? DR. JIM MCRAE: No they wouldn’t. If they are not looking for something then they are not going to find it. First of all, with respect to the vaping thing – the lung injuries that are popping up, which by the way are pretty scary. If people – they have been hearing about it on the news but my evaluation of it and I know a little bit about this stuff is its scary. As soon as the proprietors that are looking at the worst cases – the ones that have died. They are cutting out pieces of their lung and looking at the tissue. One of the pathologists – an experienced person – made the comment that it looks almost like a chemical burn as you would expect if you saw mustard gas in the lungs, poisonous gas they used in the trenches. Clearly that is horrific because that implies not something that builds over time – it’s only if you vape too much it’s gonna get you. That’s the sort of thing if you get a hot shot of whatever that stuff is, its gonna burn your lung – it is going to chemically burn your lungs and they may not recover. Meanwhile its (UNINTELLIGIBLE) because most of these people are being seen now that are getting that level of scarring. Remember a lot of them are dead. That is why they have the lung tissue to look at them. But they are going to the emergency room because this young American individual that was climbing mountains yesterday and did a hit off of their nicotine (UNINTELLIGIBLE) vape pen is suddenly in the hospital unable to get enough oxygen to support their bodily functions out of their lungs. So that is kind of scary. So yes, will the labs do something about that? If they know what they are looking for. What the labs do look for typically is some of the culprits – heavy metals is a possibility although (UNINTELLIGIBLE) would come along this acutely. There would be more of an accumulation. After ten years your knee joints would stop working and then your teeth would fall out and all that good stuff happens. With the chemical stuff the biggest suspect that I know of that we test for some times is pesticides and these are all concentrates. Those are the things that people put on plants – concentrate when you concentrate them. And all the data this way for sure is that in Washington when we have looked at concentrates and when other people are looking at concentrates and when government agencies have looked at concentrates. They are typically seen over 50% of them popping positive for at least one pesticide and many instances more than one pesticide. Although the allowable levels of presence – in some cases many, many times higher than the allowable levels. Who knows if there’s a read beneath the rose but they are all designed to kill critters in one way shape or another or make them not able to reproduce or something, or breed. Pesticides are not good things to be pumping in to your lungs in big doses. A batch of concentrates concentrated in pesticide drenched raw material – if that ever occurs – it doesn’t in regulated systems but not everybody tests – they could possibly be doing this. I don’t know what it is. I am really curious to see what the CBD says. I hope pure people get heard going forward since the news is out. DOUG MCVAY: This is an interview with Dr. Jim McRae, he is a data scientist and consultant based in Washington State. We are talking about labs and lab testing of the legal cannabis market. You are listening to Century of Lies, I am your host, Doug McVay. Let’s get back to that interview. That really is what prompted my badly worded question from earlier about how these tests work and if it’s just out pops a sheet that tells you everything that is in it. If you don’t know what you are looking for it would be tough to find it. DR. JIM MCRAE: Yes. Pesticides typically labs will do this – let’s assume there are at least 10,000 possible pesticides out there. That is probably in the right ballpark. Nobody is going to test for 10,000/ that is expensive. You have got to test for each Amolite they call them – each pesticide. The list that I have seen typically are somewhere between 22 – 250 individual pesticide Amolites that folks test for. I think usually the regulatory bodies are more in the 2- 50 range they require. It really varies heavily. Every piece of data I have gotten – most of the good stuff I have got is from Washington that I can talk about. I have data from other states that show that a handful of pesticides are showing up much more often than other and I am not going to talk about the beer. Those are commonly available if you look for them. They are kind of scary because some of those actually have directly demonstrable cardiopulmonary ramifications and so we see people dropping unexpectedly and fairly suddenly from vaping nicotine and/or THC stuff which appear to be differentially sourced from nonregulated channels or poorly regulated channels it is kind of scary. DOUG MCVAY: Indeed. I am in Oregon for instance and the contents have to be listed except that natural flavors just get listed as natural flavors. Viscosity booster – whatever the heck that is – the stuff that is added to make the stuff work better in these little pens doesn’t have to be looked at at all and that’s the part that gets – the product has been tested, that is fine. But what if we don’t know what is in those other things that are added? DR. JIM MCRAE: Sure. A lot of folks don’t know the folks that are doing it. Ask questions. Require stuff on the label. Require your budtender to know what the (BEEP) your processors – the people that are carrying it on the shelves – are doing with their product. I know people that are producing in the state of Washington who just intrinsically knowing that that extractor is on their staff, I trust the product that is coming out of that farm and that processor. No question. Anything they make is safe, good and high quality. People need to start differentiating the product that they take and I don’t know what the best source of information is in different states. I know what it is in Washington. They really should start differentiating and asking questions. Require when you buy a product to see the certificate of analysis that the lab made when they tested that brand/harvest/batch of product. If the store can’t supply it go shop somewhere else. Little things like that. If the brand can’t supply it buy a brand that can. Brands that stand behind their product – brands that put it in writing. That is the idealist in me talking. Know who is doing your product. If you don’t know then really pay attention. If any of the industry groups are lobbying your local government for regulators to try ensure product is safe and that the labels are accurate with respect to potency support those efforts. Encourage them. Tell them you are paying tax for your legally regulated cannabis. You want your label to mean something. You want there to be value to having regulated cannabis versus the unregulated stuff that is still available to you presumably but it is part of being regulated. Part of being regulated is knowing what you are taking and knowing that it has passed a minimal number of defined, quality assurance safety tests and that is not too much for a consumer to ask. Washington has profited 500 million dollars a year in new tax revenue now from this – from cannabis. Directly. That is not even multiples down the road. That is directly from the industry. A pretty good chunk of change. The consumers should get benefit from that. DOUG MCVAY: This is the thing I have been trying to talk about quite a bit and listeners know I have been harping on this but you know prohibition ends – that doesn’t mean it turns in to a libertarian wet dream. We need to have regulation. There has to be safety. Part of the concern has been – as my friend Dean Becker always says – we are under prohibition. You don’t know what’s in that bag. So with regulation we should, right? DR. JIM MCRAE: I am going to challenge just one you just said if you don’t mind. DOUG MCVAY: Please. DR. JIM MCRAE: You said when prohibition ends. Prohibition has not ended. What we have is legalization with prohibition and as soon as you see you can’t place a store within a 1000 feet of a school that is prohibition. You are prohibiting that 1000 foot radius. More importantly, there are still people in jail for selling cannabis, for using cannabis, for possessing cannabis with no voluntary thing associated with that just what we do now today legally and producing taxes. There are limited numbers of licenses being granted for retailers, growers, processors but that is a control thing. That is not free access. Some states – the one I live in for example, have begun to regulate medical cannabis and they have done it in a way here now with more than three years under their belt in a way that has just been a dismal failure by any measure and the response of the state agency, the Department of Health – the primary agency – is just to shut up shop. They stopped updating their reports. They used to report every month a list of the stores across the state. We have about 470 active retail stores for cannabis – which of those stores, what subset of those stores were able to treat or serve a patient as a patient. And then there is that well, we don’t want to go in to details…but there are some added services like having a certified medical consultant that knows something more than a typical budtender typically does. Being able to initiate their card if it needs to be initiated, being able to give them a sales tax-free (the still pay 37% excise tax), and slightly less expensive purchase than they otherwise would have. They stopped updating that list. The last time it was updated was almost six months ago so our regulators – the main reason they stopped updating is because they lost a huge number. There are fewer stores that are medically certified now, three years in to a regulated market than there were 12 months in to it. There are fewer patients registered in the database now three years later than there were 12 months in to it. There are less products being sold to patients as patients today than there was two years ago. It is ridiculous. DOUG MCVAY: I fully accept and acknowledge your criticism. You are exactly right. That was a dead gap and I should know that. DR. JIM MCRAE: But that was indirectly to the point of one of the few differentiators that the medical patients have in product in Washington State and they represent less than 2% of the product that is sold so 98% of the product in our state does not require pesticide or heavy metal testing. The only stuff that does is the 2% or less than 2% that is sold to patients as certified by the Department of Health as medical grade cannabis and that has been pesticide tested and heavy metal tested but that is less than 2% of the product in our state. We are the only state in the nation that does not require pesticide testing so many of my patient friends who typically are high dose users, and often have compromised immune systems often have been weakened in one way or another. The last thing they need is massive doses of pesticides and heavy metals in their system. So if they are in a position where they do not trust the regulated – or the vast majority of the regulated system what are they to do? I don’t know. Hopefully they are not going to vapes that are doing stuff that we are seeing in young, healthy people across the nation right now. DOUG MCVAY: Well I think those were some very on point and sobering thoughts, frankly. Tell us how to find your website, how to find you on social media – and keep up with the work that you are doing and if you have any closing thoughts for the listeners? DR. JIM MCRAE: Sure. First of all the best place to get me is my blog. I am going to be starting in on my commercial stuff in the very near future because I am becoming a public servant and doing stuff in that range but the blog will probably continue on so that is Hot Blog – www.highintelligence.org – that will go to the blog. Closing remarks – I wish all of the states coming on line all the best. Vaping people – I would be very careful. Particularly if you start seeing stuff from the unregulated market. There is something out there that is doing really bad damage. We don’t know what it is. I have no reason to believe that it is the flavors that Washington banned the other day. It’s something that it could be – but something is going on and until the CDC figures it out, which will hopefully happen soon - be careful before you source anything you vape and be careful about vaping. DOUG MCVAY: That was my interview with Dr. Jim McRae, he is a data scientist and consultant based in Washington State. We have been talking about lab tests in the cannabis market and that is all the time we have today. You have been listening to Century of Lies we are a production of the Drug Truth Network for the Pacifica Foundation Radio Network. On the web at www.drugtruth.net. I have been your host, Doug McVay, editor of www.drugwarfacts.org. The Executive Producer of the Drug Truth Network is Dean Becker. Drug Truth Network programs are available by podcast, the URL’s to subscribe are on the network homepage at www.drugtruth.net The Drug Truth Network has a Facebook page, please give it a like. Drug War Facts has a Facebook page, too, give it a like. Share it with friends. Remember, knowledge is power. We will be back in a week with 30 more minutes of news and information about drug policy reform and the failed War on Drugs. For the Drug Truth Network, this is Doug McVay saying so long. For the Drug Truth Network this is Doug McVay asking you to examine our policy of drug prohibition, the Century of Lies. Drug Truth Network programs are archived at the James A Baker Institute.