Browsing the backlit counters of Exhale Med Center’s medical marijuana dispensary, patients could easily be overwhelmed by all the options.
If they don’t want to smoke one of the 60 marijuana flower varieties lining the shelves, they could chew a taffy, pop a pill, take a tincture or vaporize an oil with a black and yellow Bumblebee pen. In other words, customers can now choose from a variety of products made from concentrated marijuana, and increasingly that’s what they want.
It’s good news for the industry, too.
These increasingly popular products that sell at high margins are made from the scraps of lower-margin inventory. Concentrates are made by extracting the active ingredient from the raw product.
These concentrates, once 2 percent to 3 percent of Exhale’s business when it opened in West Hollywood in 2013, now account for as much as 15 percent, said co-founder Dimitry Muzychuk.
“Concentrates are rising more in popularity,” Muzychuk said.
In fact they’re so attractive, co-founder Vitaly Mekk sunk about $75,000 into a commercial-grade carbon-dioxide extraction machine and started making vaporizer cartridges that the dispensary sells, said Jeremy Carr, another Exhale co-founder.
“Margins are higher on (the concentrates) side and it uses excess product from cultivation,” Carr explained.
As marijuana goes more mainstream, products are evolving and diversifying. Concentrates appeal to consumers because they can be more discrete and more easily standardized. Some also offer a more intense high, while others can mete out a very tiny one.
Certain concentrates are extracted from the marijuana plant with ice water, other forms use pressurized carbon dioxide, alcohol, propane or butane. Extractors and dispensaries have their preferences, and some steer clear of solvents altogether.
“Concentrates have been around forever, look at hash,” said Steve Gormley, chief business development officer of OSL Holdings Inc., a publicly traded retail and management services company in Yardley, Penn., that caters to the medical marijuana industry. “They’ve just gotten more sophisticated.”
While these offerings might have their appeal, the industry still lacks consistency and some players don’t always deliver on promised benefits. A small study published last week in the Journal of the American Medical Association found that a sampling of edibles from three major metro areas, including Los Angeles, failed to meet basic label accuracy standards for pharmaceuticals and might not produce the desired medical benefits.
Discreet, sexy
Vaping marijuana, or inhaling vaporized cannabis oil, is a perfect example of the new focus on refinement. Vaping pens often resemble an actual pen, release little to no odor and don’t require the rolling of a joint.
“You can use a concentrate discretely in a vapor pen and take your medicine without it showing up on anybody’s radar,” Gormley said. “Most people who use medical marijuana still have a concern about discretion because it’s still illegal on the federal level, so there is that stigma.”
They also can allow patients to manage their dosage more effectively, he added.
“When you smoke a marijuana cigarette, the flower is never evenly distributed,” he said. “That’s less likely to occur if you’re using a concentrate.”
Gormley, whose firm has operations in Los Angeles, sees vaping pens’ popularity growing particularly in more affluent markets.
“It’s easy, discreet and sexy,” he said.
When Exhale first opened, Muzychuk said he was lucky if it sold one vape pen a day.
“Now they fly off the shelf,” he said.
Carr, his partner, also pointed out that while flowers are harder to brand, concentrates are not.
Concentrates often come in sleek, hip packaging that looks like it would line the shelves of Whole Foods or a Silver Lake boutique. And whereas high-end flowers can run around $20 a gram at a medical marijuana dispensary, concentrates can fetch $40 to $50 a gram.
They also have much higher concentrations of tetrahydrocannabinol, the primary psychoactive ingredient in marijuana. The untreated marijuana flower that’s smoked has about 20 percent THC. That level can reach as high as 90 percent in a concentrate.
THC levels can also be doled out in extremely small quantities, such as capsules or tincture drops, which can be beneficial for some.
“The future of cannabis is about smaller doses,” said Carlos Delatorre, co-founder of Cornerstone Collective, a limited-membership medical dispensary in Eagle Rock that eschews green cross signage in favor of blog posts on the latest cannabis research. Delatorre thinks that if marijuana becomes legal for recreational use, 5 milligram doses will become very appealing.
“If you have a lot of leftover product, you can make concentrated products for any person to use to take the edge off,” he said. “You could pop a lozenge or something for a little mood elevation, euphoria or pain relief.”
