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Cannabis vape sales lag as lung illnesses rise

Oregon sees a 62% drop in market share for vaping products

By GILLIAN FLACCUS and JENNIFER PELTZ, Associated Press
Published: September 26, 2019, 8:10pm
3 Photos
David Alport, owner of the Bridge City Collective marijuana dispensary in Portland, goes over sales numbers Sept. 20 with the store&#039;s general manager Cameron Moore. The company has seen a 31 percent decrease in its sales of vaping products in the past two weeks.
David Alport, owner of the Bridge City Collective marijuana dispensary in Portland, goes over sales numbers Sept. 20 with the store's general manager Cameron Moore. The company has seen a 31 percent decrease in its sales of vaping products in the past two weeks. (Gillian Flaccus/Associated Press) Photo Gallery

PORTLAND — Vaping products, one of the fastest-growing segments of the legal marijuana industry, have taken a hit from consumers as public health experts scramble to determine what’s causing a mysterious and sometimes fatal lung disease among people who use e-cigarettes.

The ailment has sickened at least 805 people and killed 13. Some vaped nicotine, but many reported using oil containing THC, marijuana’s high-inducing ingredient, and said they bought products from pop-up shops and other illegal sellers.

The only death linked to THC vapes bought at legal shops occurred in Oregon, where health officials on Thursday announced a second fatality and urged people to stop vaping.

Amid the health scare, the amount of the legal pot industry’s revenue that comes from vape products has dropped by 15 percent nationwide, with some states seeing decreases of more than 60 percent.

Vaping THC is popular for those desiring a quick high without the smoke that comes from lighting up joints. Marijuana companies are trying to boost the public’s confidence by promoting that their vaping products are tested by the government, demanding ingredient lists from their vendors and in some cases pulling items from shelves. Some also are scrambling to get liability insurance.

Still, many have seen notable declines in sales since the health scare emerged on a national scale last month.

“It’s having an impact on how consumers are behaving,” said David Alport, owner of Bridge City Collective in Portland, which in two weeks this month saw a 31 percent drop in sales of vape cartridges that hold the oil that vaporizes when heated. “People are concerned, and we’re concerned.”

Health officials in California, home to the world’s largest legal marijuana marketplace, this week issued an advisory urging people to stop all vaping. Massachusetts, which like California allows so-called recreational use of marijuana by people 21 and older, went further than any other state, issuing a four-month ban on vape sales.

In the booming legal U.S. cannabis market, vaping products had been exploding in popularity. In roughly two years, they grew from a small fraction of overall sales to about one-third, with $9.6 billion in sales between 2017 and 2019, according to New Frontier Data, an economic analysis firm that tracks the industry. About one-fifth of U.S. cannabis consumers report using them.

New Frontier found a 15 percent decline in the market share for vape sales nationwide during the first week of September and saw no rebound in data collected through Sept. 18. At the state level, New Mexico, Massachusetts, Nevada and Montana all saw drops of one-third or more, while California fell by 6 percent.

Oregon, among the earliest of the 11 states that legalized recreational marijuana, has seen a 62 percent drop in market share for vapes, said John Kagia, the firm’s chief knowledge officer. The big decline occurred after the state’s first death was announced and officials said the victim had used vapes purchased at legal retailers.

Yet as vape sales sink, some retailers report sales of other cannabis products going up. Bridge City Collective, for example, saw its usually lackluster edible sales increase about 40 percent the same week vaping sales plummeted. Consumers also are showing more interest in the dried flower used in joints.

Analysts are watching to see if vape sales erode further after the U.S. Centers for Disease Control and Prevention announced Thursday that the number of suspected vaping-related illnesses had grown by 52 percent in the past week.

“This is a very, very fast-moving issue, and it will likely be a couple more weeks, if not months, before we understand the impact it’s really had on the retail ecosystem and on consumers’ attitudes,” Kagia said prior to the announcement.

Doctors have said the illnesses resemble an inhalation injury, with the lungs apparently reacting to a caustic substance. So far, no single vaping product or ingredient has been linked to the illnesses.

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