Cannabis Companies may soon face product liability risks
Cannabis and Hemp Companies Disregard Emerging Product Liability Risks at Their Peril
Novel cannabis products and our understanding of how they interact with our bodies are evolving in tandem, which is unique compared with any other consumer product. Although cannabis research has been outpaced by consumer behavior and public policy, it is now catching up. Relying on new studies, attorneys may soon seek to establish medical causation that links the use of high-THC products to cardiovascular conditions, mental health issues and susceptibilities in certain consumer populations. The hemp industry is not immune, given the recent explosion of unregulated but intoxicating hemp-derived products that contain levels of THC similar to regulated cannabis products.
In this article we describe how this evolving product risk has the potential to result in enormous future liability for which cannabis and hemp companies are currently unprepared. Those industries should embrace a mix of legal reform, policy changes and adoption of traditional risk management principles to prevent future product risk issues from damaging market sustainability.
A New Breed of Cannabis Product Litigation
As a society, we hold product manufacturers liable for placing an unreasonably dangerous product on the market. What is “unreasonably dangerous,” however, is an open question when it comes to cannabis since, until recently, federal illegality largely precluded the availability of reliable studies on questions of safety and efficacy. The number and quality of such studies have increased over the past few years, coinciding with cannabis legalization at the state level, relaxation of rules around cannabis research and removal of hemp from the Controlled Substances Act (CSA).
Armed with these new studies, potential plaintiffs may start seeking to use the courts as quasi-regulators for the cannabis and hemp industries. Some lawsuits already have alleged, for example, that cannabis companies seek to take advantage of the public’s perception of cannabis products as safe and healthy despite the fact that THC and other cannabinoids have been linked to various adverse side effects. It also has been alleged that although edible cannabis products are linked to more severe adverse effects than smoking marijuana, those products have been marketed by some companies as the safer and healthier alternative. The hemp industry, meanwhile, should brace itself for similar allegations brought against hemp-derived THC products that are becoming increasingly popular and available.
This new breed of cannabis product liability lawsuit may seek to establish alleged serious adverse health consequences from the ingestion of cannabinoids using an expert-driven legal strategy that has the potential to be used against any company that sells products containing THC, CBD or any of the minor cannabinoids. Those companies should pay close attention.
The Endocannabinoid System
To understand these emerging product liability concerns, it is necessary to briefly describe the endocannabinoid system (ECS). First identified in the early 1990s, the ECS is a system of chemical signals and receptors that help to regulate numerous bodily functions. The two primary receptors for cannabinoids are called the CB1 and CB2. The CB1 receptors, which are located primarily in the brain and central nervous system, help regulate coordination, pain, mood, appetite and other functions. CB2 receptors are located throughout the body and are common in the immune system. They primarily affect inflammation and pain.
THC’s power of intoxication results from its ability to mimic anandamide, a naturally occurring endocannabinoid that binds to CB1 receptors in the brain associated with improved mood. THC binds to anandamide’s CB1 receptor even more tightly than anandamide can, which inhibits the release of other neurotransmitters. This results in an exaggerated mood response associated with feelings of euphoria.
CBD, on the other hand, loosely binds with the receptors and acts like a modulator that can amplify or decrease the receptor’s ability to transmit signals, similar to a dimmer switch. It is thought that this modulation of brain activity may be the basis for CBD’s ability to reduce seizures and the symptoms associated with mood disorders such as anxiety and depression.
THC and CBD have a synergistic effect by working in tandem. Cannabis users have long observed that high concentrations of CBD have a modulating effect on the intoxicating potency of a cannabis product, even for products with high levels of THC. This phenomenon has been clinically confirmed by researchers at University College London, who used functional MRI (fMRI) technology to demonstrate that high-CBD cannabis varieties result in less impairment to brain function than varieties with lower CBD concentrations but similar levels of THC.
Method of Ingestion
How cannabis interacts with the body also is dependent on the method of ingestion and the physical characteristics of the cannabis user. Though seemingly counterintuitive, the consumption of edible cannabis has been associated with a higher risk of adverse events and the resulting need for acute medical care compared with smoking or vaping cannabis.
Many consumers are unaware that, unlike smoking or vaping cannabis, the onset of effects with edibles is delayed until 30–60 minutes after ingestion with a peak effect within 3–4 hours. An oral dose of 10–20 mg of THC is sufficient to cause psychotropic effects and an oral dose of 30–40 mg of THC would cause significant intoxication in most people.
Edible consumption also can result in highly variable effects. Eating a high-fat meal, for example, can significantly exacerbate the effects. The budtender’s mantra for advice to new consumers of edibles is therefore to “start low and go slow.”
Impact of Legalization
As more people use cannabis due to increased access from legalization efforts, the likelihood of medical and health consequences also has increased. In the United States, disparate state regulations with no federal oversight has resulted in a lack of uniformity in dose, cannabinoid concentrations, product labels and warnings. The United Nations World Drug Report 2022 describes a “simultaneous quadruple confluence” of increasing prevalence of use, intensity of use, THC content and hospitalizations that “all likely interact multiplicatively in the context of studying the impact of legalization.”
Increasing THC Concentration
Many experts point to the increasing THC concentration in modern cannabis products as a leading cause of uncertainty when attempting to quantify cannabis product risks. The vast majority of studies that physically handle cannabis have used samples provided by the federal government that contain THC concentrations in the 3% to 6% range. That is only a fraction of the THC content of modern cannabis products sold in dispensaries and adult-use retail stores, on which few meaningful studies have been performed. Many older studies may therefore no longer be relevant.
Emergency Department Visits and Hospitalizations
The number of cannabis-related emergency department visits and hospitalizations generally see an increase after state legalization, followed by a leveling off. For example, those numbers increased in Colorado after 2013 but generally stabilized by 2018. California likewise saw an initial 56% rise in ER visits and hospital admissions from 2016 to 2019. The most common reasons for seeking medical care include anxiety, panic attacks, vomiting and other nonspecific symptoms. Cannabis edible products are attributed with the largest increase in ER visits and hospitalizations, particularly involving children. Emergency departments also have seen a significant increase in cannabis hyperemesis syndrome caused by heavy chronic use, particularly in young men with low body fat, characterized by stomach pain, nausea and intractable vomiting.
Cardiac and Vascular Effects
A key concern is whether cannabis can trigger a major cardiac or vascular event such as a severe cardiac arrhythmia, heart attack or stroke. Statistical limitations and confounding factors have thus far prevented a firm conclusion of cause and effect, but several associations have been observed. This has prompted statements issued by the American Heart Association in 2020 and the American College of Cardiology in 2021.
The ratio of THC to CBD may be an important but under-appreciated factor in determining whether a specific cannabis product has the potential for cardiovascular harm. THC is known to stimulate the sympathetic nervous system while inhibiting the parasympathetic nervous system. THC can increase heart rate and blood pressure. CBD, in contrast, can reduce heart rate and blood pressure, while improving vasodilation and reducing inflammation.
In states where cannabis has been legalized, an increase in emergency department visits and hospitalization has been observed for heart attacks, including in young men without ischemic disease. In addition, there is some evidence that cannabis use may result in an increased risk for stroke. One recent retrospective study found a greater than three-fold risk of stroke in regular cannabis users within the past year. Other studies, such as the long-term prospective CARDIA Study (Coronary Artery Risk Development in Young Adults) did not show an association between long-term or recent cannabis use and cardiovascular events.
Data on the true cardiovascular risk from cannabis remains unreliable because most studies have been short-term, observational and retrospective in nature, as opposed to more reliable long-term prospective studies that are controlled with product and dose standardization. Available studies also suffer from confounding factors such as selection bias and uncontrolled adverse health behaviors such as tobacco use. As noted above, older studies may no longer be relevant due to the increasing concentration of THC in today’s products.
For these reasons, evidence of a causal relationship between cannabis use and cardiovascular harm remains inconclusive. The cannabis industry should nevertheless pay close attention to emerging studies on this topic.
Microbial Contaminant Health Effects
The microbes associated with cannabis are mostly harmless, but some species can cause human illness. Invasive mycoses such as fusariosis, aspergillosis and mucormycosis can cause fatal illness in the severely immunocompromised. This group includes those undergoing chemotherapy, recovering from severe illness or taking immunosuppressive drugs after organ transplantation. These diseases often have mortality rates greater than 50%. In total, cannabis users also experience a roughly 350% increase in fungal infections when compared with nonusers, according to commercial insurance data.
Illness from bacteria such as E. coli or salmonella has been reported, as have life-threatening asthma attacks triggered by inhaling mold spores in commercial cannabis grows. Mycotoxins are potently carcinogenic, fetotoxic and neurotoxic chemicals produced by Aspergillus, Fusarium, Penicillium and other mold species commonly associated with cannabis. These can accumulate in cannabis products, are difficult to remove and cause severe illness.
Mental Health Effects
It has been observed that as cannabis use has become more frequent and cannabis products have become more potent, certain psychiatric illnesses and cannabis use disorders have risen. Some mental health professionals have drawn attention to the rising THC and falling CBD content in many modern cannabis products, positing that an increased THC ratio may heighten dependency and the chance of psychiatric disorders.
Evidence exists of an association between high-THC cannabis and an increased risk of psychosis and schizophrenia. This risk may be heightened in individuals with a predisposition to those disorders and people who use cannabis early in adolescence.
There also is some evidence that cannabis is present in an increasing proportion of suicide deaths when compared to alcohol, in a trend that started before legalization. Data from Colorado suggests that the proportion of suicides in which cannabis was present tripled between 2006 and 2018. By comparison, the proportion of suicides where alcohol was present increased only slightly over the same period.
Other recent studies have noted similar associations between cannabis use and psychiatric disorders. A Canadian study, for example, observed that after marijuana was legalized in 2018, there was an increase in cannabis use from 20% to 37% of ER patients who sought consultations with a psychiatrist, and particularly among patients aged 18–24. Lancet Psychiatry published a 2019 study of a possible association between cannabis use and psychotic incidents across Europe, concluding that “daily cannabis use was associated with increased odds of psychotic disorder compared with never users, increasing to nearly 5 times increased odds for daily use of high potency types of cannabis.” A 2021 Danish study concluded that schizophrenia cases associated with cannabis use disorder have increased 300% to 400% over the past 20 years as the potency of cannabis his increased 200% over the same period.
Many of the available studies on the mental health effects of cannabis use suffer from the same limitations and confounding factors discussed above for cardiovascular risks. Additional research is therefore needed through well-controlled prospective studies.
Chronic Use and Addiction
Though cannabis is widely considered to be far less addictive than other recreational drugs and alcohol, it nevertheless does have addictive potential and is associated with the development of cannabis use disorder (CUD). The National Institutes of Health reports that CUD has been observed in approximately 9% of users, 17% of those who begin use in adolescence and 25% to 50% of daily users. The incidence of CUD has been impacted by higher rates of edible consumption and vaping – products with higher ratios of THC to CBD and increased initial use in adolescence.
The regular use of cannabis before age 18 has been associated with harmful consequences later in life, including mental health problems as well as deficits in attention, executive functioning and IQ. Studies suggest that regular cannabis use during adolescence may lead to permanent structural changes in the brain. Although cannabis has been observed to help some older patients with psychiatric conditions such as anxiety and depression, similar effects on adolescents are less clear.
In 2019, JAMA Psychiatry published the results of a meta-analysis of 11 studies that included almost 25,000 individuals to assess the extent to which cannabis use during adolescence is associated with the risk of developing subsequent major depression and suicidal behavior. The conclusion was that adolescent cannabis users were 37% more likely to develop depression than their peers. Increased risk of suicidal ideation and suicide attempts also was observed. The findings translate into more than 400,000 cases of adolescent depression in the United States that are potentially attributable to cannabis exposure. The authors recognized, however, that given limitations and confounding factors, a strong causal association could not be made between cannabis and later depression or suicide in adolescents.
Conversely, the recent June 2022 “CannTeen” study published by the Journal of Psychopharmacology found that “16- to 17-year-olds were not at an interactively greater risk of cannabis-related mental health problems, compared to 26- to 29-year-olds.” The study did conclude, however, that adolescent cannabis users are more likely to have severe CUD and greater psychotic-like symptoms than adult cannabis users. The authors acknowledged that more research is needed.
The perception of harm from cannabis use by pregnant women may be decreasing as state legalization expands. Data suggests that cannabis use by women before, during and after pregnancy has increased in states that have legalized marijuana. This includes data collected from almost 40,000 women by the Pregnancy Risk Assessment Monitoring System. A 2018 paper published in the Annals of Internal Medicine reported that “approximately 70% of both pregnant and non-pregnant women believe there is slight or no risk of harm from using marijuana once or twice a week.” Shockingly, the paper also observed that “18% of pregnant women who used marijuana in the past year met criteria for a marijuana use disorder.”
THC can enter the fetal brain and can disrupt the endogenous endocannabinoid system in the fetus. Prenatal cannabis use may impact birth weight and brain development with long-term consequences. The National Academies of Science has emphasized, however, that there remains insufficient information on the health implications of cannabis use in pregnant women and other vulnerable populations.
The cannabis industry must better educate itself on risks to vulnerable patient and consumer groups. A recent survey of Colorado cannabis dispensaries, for example, resulted in nearly 70% of respondents admitting to recommending cannabis products to pregnant women for nausea.
In response to the increasing prevalence of medical marijuana patients and those who self-medicate with adult-use cannabis, physicians are grappling with how to prevent harmful drug interactions. This is of particular concern for older individuals who tend to take more prescription drugs. Cannabinoids can interact with various medications, including certain antidepressants, antipsychotics, beta-blockers, benzodiazepines, statins, protease inhibitors and anti-seizure medications. These interactions can be difficult to identify and prevent due to the wide variability in cannabis products, potencies, doses, cannabinoid ratios and methods of ingestion. A solution is further complicated by lack of physician education and the ongoing reluctance of many patients to admit to cannabis use.
What Is the Solution?
Decades of myth and disinformation around the supposed harm of cannabis use culminated in its inclusion on Schedule 1 of the CSA, which is reserved for those most dangerous drugs, such as heroin, that have a high potential for abuse and no accepted medical use even under the supervision of a physician. It is now widely accepted that cannabis is simply not in the same league as commonly abused drugs such as narcotics or even alcohol. Physicians across all disciplines, meanwhile, are beginning to understand and embrace the promise of cannabinoid medicine.
It must nevertheless be acknowledged that many in the cannabis and hemp industries quickly embrace new evidence of the benefits of cannabinoids while largely overlooking studies that raise potential health concerns. There is an understandable urge to believe that cannabis cannot be harmful because it is a plant and therefore “natural.” Such positive messaging, amplified by the media, politicians and celebrities, has normalized cannabis use to the delight of millions of Americans.
This exuberance, however, should be tempered with clear-eyed realism about the potential for harm that can be associated with cannabis use, and the associated liability risks. For the reasons laid out above, the cannabis and hemp industries should embrace a mix of legal reform, policy changes and adoption of traditional risk management principles to prevent future product risk issues from damaging market sustainability.
First, marijuana must be removed from Schedule 1 of the CSA and regulated much like alcohol with federal oversight of state regulatory structures that are harmonized with respect to product testing, labeling and warnings. Legal reform at the federal level will allow for greater investment in cannabis research, especially involving modern high-THC products, and better education opportunities for consumers and medical clinicians.
Lessons can be drawn from the alcohol, tobacco and pharmaceutical industries on how not to pursue commercial interests at the expense of vulnerable groups. To reduce product liability risks, myths and misperceptions about cannabis use must be dispelled so that companies can engage customers in an informed evidence-based conversation about their cannabis products.
Education is therefore essential to properly mitigating the true liability of products that contain cannabinoids. Eventually, companies will embrace more-robust cannabis product warnings, but these warnings must be factual to result in effective risk reduction. Allowing the establishment of a standard that stops short of this demand for accuracy will only exacerbate the confusion that already plagues the industry.
More thorough product warnings may happen suddenly through new regulations or it may be a slower process that is accelerated by large jury verdicts. Either way, it is difficult to imagine a future without cannabis and hemp product pamphlets of the type that accompany most “over the counter” medical products and other regulated consumer products. Warnings may include statements about the difference between smoking and orally consuming cannabis, the duration of effects, cannabinoid ratios and the impact on impairment, the risk of adverse health effects and warnings directed to specific vulnerable groups.
Finally, effective product liability risk management and insurance are critical for all companies that sell cannabis or hemp products. It is vital that companies differentiate between risk management (which actively reduces risk) and insurance (which transfers or shares the risk that cannot adequately be reduced). No insurance coverage has ever reduced risk, so it is important that the two processes work in tandem to create a barrier against the increasing threat from cannabis product liability. Working with competent risk managers, legal counsel and insurance brokers who are familiar with the cannabis insurance market and committed to true risk management is recommended to ensure that cannabis and hemp companies are prepared to defend against claims and litigation that allege injury or illness from cannabis use.